Types of Income (definitions)

•  Investment Income: “Investment income” includes interest, rents, royalties, dividends, capital gains, and other income derived from an asset. Examples of investment income include, but are not limited to, income derived from: stocks, bonds, investment funds, and other securities; real estate; retirement investment accounts; annuities; the investment portion of life insurance contracts; interests in trusts and estates; collectible items; commercial crops; accounts or other funds receivable; and businesses.

The definition of investment income for our purposes of financial disclosure is specifically not tied to the Internal Revenue Service’s definition of income for tax purposes. You need to report accrued income, even if deferred or exempt for tax purposes. For example, tax-deferred income in a retirement account is reportable in your financial disclosure report. Where you do not receive a report of the amount accruing, such as with United States savings bonds, you may make a good faith estimate.

•  Earned Income: “Earned income” includes fees, salaries, commissions, honoraria, and any other compensation received for personal services but excludes U.S. Government salary and other federal benefits, including retirement and veterans’ benefits. If personal services (provided by you or your spouse or dependent children) are a material factor in the production of income from an asset or business, it is considered “earned income” for purposes of financial disclosure rather than “investment income.” However, your dependent child’s sources of earned income are not reportable.

•  Other Non-Investment Income: A remainder category exists for income that does not fit into the investment income or earned income categories. Examples include prizes, scholarships, awards, and gambling winnings. Report only your own sources of other non-investment income. Other non-investment income received by your spouse or dependent child is not reportable.

 

This guide is not intended to provide investment advice, and you should not rely on statements in this guide when making investment decisions.

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