The character of income determines the rate at which the income is taxed.

Name: The character of income determines the rate at which the income is taxed.
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The character of income, such as whether it is earned income or investment income, does determine the rate at which it is taxed. Different types of income are subject to different tax rates, deductions, and credits. For example, long-term capital gains are taxed at a lower rate than short-term capital gains or ordinary income.

The Character of Income Determines the Rate at Which the Income