Your Form K-1 may show income that relates to (among other things): (1) interest income; (2) net rental real estate; or (3) gains from the sale of real estate.
Interest income is considered portfolio income and will typically be taxed at your marginal tax rate. Net income from rental real estate is also taxed at your marginal tax rate, but is subject typically to passive activity rules. Capital gains will be taxed at rates of 15% to 20% depending on your tax situation.
The taxation of different categories of income is an important issue to taxpayers. Make sure that you discuss these classifications with your tax advisor.