Is income from a rental property considered earned income?
No. Residential Rental Property income is passive income.
If you run something such as a Bed and Breakfast, that's where you provide your tenants services on a recurring basis that are "directly beneficial to the tenant". Exactly the same as a hotel. That would be considered earned income and reported on SCH C.
"Directly beneficial to the tenant" would include things like daily maid service, daily breakfast included with the rent payment, laundry services, etc.
But with residential rental income you don't "do" anything on a recurring basis to actually "earn" it. All you do is "sit there" and college the rent every month (or whatever the recurring pay period is.) So that's passive income reported on SCH E.
