[quote=SK in CV]”Passive income” has a very specific meaning in the tax code. It generally refers to net rents, and other business activities where the taxpayer has no material participation. (not dividends, generally not capital transactions) Losses from passive activities (with some exceptions) are limited to net income from other passive activities. You are correct that capital gains are taxed at some of the lowest rates.[/quote]
Thanks for clearing that up. Well, I did use the wrong words then. I should have just said capital gain instead of passive income.