Real estate rental is unearned income and must be report on Schedule E.
You can only report your rental as a business on Schedule C in either of the following cases:
1. You provide hotel-like services with your rental such as maid service, cleaning service, transportation, etc... See this TurboTax Help article.
2. You are a real estate professional. To meet this condition, you have to meet the following 4 tests:
- You materially participated in a real property trade or business.
- More than half of your time is involved in real estate activities during the year.
- You materially participated for more than 750 hours in this business.
- You materially participated in each rental real estate activity.
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