Investment income can come from various sources, and not all types are created equal. Different types of income have different tax implications, risk levels, and growth potential. Here are a few key distinctions:

1. Interest Income: This is income earned from investments in bonds, savings accounts, or certificates of deposit (CDs). It's typically a fixed amount and is usually taxed at your ordinary income tax rate.
2. Dividend Income: Dividends are paid out to shareholders of stocks, mutual funds, or ETFs. They can be either qualified or non-qualified, with qualified dividends being taxed at a lower rate than non-qualified (or ordinary) dividends.
3. Capital Gains: When you sell an investment for more than you paid for it, the profit is considered a capital gain. Short-term capital gains (on investments held for less than a year) are taxed at higher ordinary income rates, while long-term capital gains (on investments held longer than a year) are taxed at a lower rate.
4. Rental Income: This comes from owning real estate and renting it out. It can generate steady cash flow but also comes with the complexities of property management and maintenance.
5. Business Income: If you invest in a business, either as an owner or a shareholder, you may receive income in the form of profits or distributions. This type of income can be more variable and subject to specific tax rules.
6. Royalties/Passive Income: Income from intellectual property, such as patents, trademarks, or creative works (books, music), is another form of investment income. It’s often considered passive income, but tax rules can vary.
7. Real Estate Investment Trusts (REITs): REITs pay out income from the rents they collect on properties. The tax treatment of REIT income can be more complicated, with some income taxed at ordinary income rates, and others at lower rates.

Each of these income types may suit different financial goals and come with their own set of risks. This income can be managed to a degree to lower your tax obligations. A qualified financial professional can help identify these tax savings opportunities.