9 Unique Types of Passive Income (Unearned Income)

Many people dream about living off passive income. The concept of working hard and creating a perpetual stream of income is appealing.

Unearned income is income from sources, not from employment or a job. The IRS views unearned income as income from sources other than personal  effort.

Investment income is the profit generated from the sale of real estate or stocks. An investor selling an asset for profit will generate capital gains from the sale.

Investment Income

Mutual funds pay capital gains distributions to shareholders. This money comes from selling stocks, bonds, or other assets owned by the mutual fund.

Long-Term Capital Gain Distribution

Dividend income results from money paid to stockholders from the dividends paid by companies.

Dividend Income

Retirement income is derived from pensions, annuities, and distributions from 401(k) plans and Individual Retirement Accounts (IRAs).

Retirement Income

Unemployment benefits are paid to individuals who lose their jobs through no fault of their own.

Unemployment Benefits

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