Some people lend money to other people and do so often. How you structure that investment could make a difference. For example, if you set up a single member LLC and have it loan money to others, the interest income could be income from lending. The rub is that it would also be earned income incurring a self-employment tax. However, if your other earned income is in excess of the social security threshhold, $128,700, then only about .5% of it is taxed for self employment tax. By calling income earned in lieu of investment or interest income, you qualify for the 20% reduction in income from small business activities. So, if you have a side set of investments which includes loaning money to third parties, or selling tangible personal property, you too can benefit from this use. Even if your earned income does not exceed $127,800, you’re still about 13% to the good if you use this.