Eric is a partner in an engineering firm. He is active in the business and serves as the partnership's chief technology officer. He receives a guara without regard to the firm's profits or losses. Assuming the payment is reported correctly on his Schedule K$-1($Form $1065),$ how should Eric fep

Self$-$employment income, reported on Schedule C$,$ Profit or Loss from Business $($Sole Proprietorship$).$

Passive income, reported on Schedule E$,$ Supplemental Income and Loss.

Nonpassive income, reported on Schedule E$,$ Supplemental Income and Loss $($From rental real estate, royalties, partnerships, Scorporations, estates

Wages, salaries, tips, etc$.$ reported directly on Form $1040.$