name this income

What is the name of your state? CA

About a year ago I was presented with a business opportunity with a relative. Here's the low down...

My relative purchased part ownership into a very successful and thriving restaurant. He needed additional funds to back his purchase and I provided him with the additional funds as a silent partner (the original restaurant owners do not know of any partnership between my relative and I; I am not in their "Books" at all). We agreed to split the profit percentage in half. The money is coming in monthly but I dont know how to claim the additional income. I mean, what would the IRS define this type of income? Can I also include it as additional income, for example, on a loan application?

Now, in order to get the funds for him I took out a equity loan on my house, in which I would pay off myself. Could I just "say" that my relative is repaying a personal loan and not claim the "repayment" as "income"?

Here are some figures:
Initial investment - $100000
My monthly return: $1300
Projected monthly return - ~1800-2000
Also agreed to split the equity if he were to sell off his shares.

Equity loan (HELOC): $120000 (used $20000 of it to purchase a car)
My monthly payment: $1500
loan terms: 15 years, 3.75 APR

It's alittle late to ask but could I have used the money more wisely? Please give me painful honest opinions...

Any advise is much appreciated! Thanks!