Income types refer to the various sources from which individuals or businesses earn money. The main categories include earned income, which comes from working, such as salaries or wages, and passive income, which is generated from investments or rental properties without active involvement. Another important category is portfolio income, derived from investments like stocks and bonds. Additionally, there is residual income, which refers to earnings that continue after the initial effort, such as royalties from creative works. Understanding these income types can help in financial planning and investment strategies.