 TITLE: How Is Passive Income Taxed? CONTENT: Is Passive Income Taxable?\n--------------------------\nJust like income from a full-time job, income earned from passive activities is taxable. If you sell your interest in a passive income activity or sell a property that generates passive income, you are also responsible for taxes on any earnings you make.\nThe amount you owe, though, will depend on several factors, including the type of passive income source and how much time you spent on the business. Income earned from rental properties is taxed differently from earnings from business or trade activities and cash back credit card rewards. There are many sources of passive income, and you may want to consult a professional to learn more about your specific tax situation.\nIt can also be a good idea to consult with an accounting professional _before_ you pursue passive income opportunities to make sure you fully understand the potential tax liability so you can be prepared come tax time. They can also provide more insights on recordkeeping and what documentation you may need when filing your return. END