If you offer services, it is entered on Schedule C. In your Schedule E example above, you did not mention offering services. The answer was appropriate to the information given.
Depending on how you
run your Airbnb business, you have to report your income on either Schedule C or schedule E. The
distinction is based on how actively you are involved in running your Airbnb
business and what services you offer.
Schedule E is meant
for passive income. If you are just renting out a space and you do not offer
any additional services (cooking, cleaning services, maid service etc) then you
should report on Schedule E.
If you do provide
services, like a hotel or B&B would, then you report on Schedule C.
The main difference
between these schedules is that under Schedule C you are subject to
self-employment tax and under Schedule E you are most likely subject to Passive
Activity Loss Limitations, which means that your rental deductions cannot
exceed your rental income. In other words, the IRS assumes you’re never running
at a loss. If you’re not, then you can deduct up to $25,000 regardless of your
income
