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Short-term rentals (stays averaging less than 7 days per rental) are reported on Schedule C and are considered as a business.
Net income from that Schedule C is subject to self-employment tax.
You are correct.
ST rentals that average 7 days or less are reported on Schedule E and not subject to self-employment tax unless you provide substantial services; ie: cleaning of the rental everyday, changing the sheets everyday, and providing other "hotel" like services.
I recommend you go back through the rental question section to make sure you answered all the questions appropriately. The other issue to be aware of are the questions related to your participation; passive, active and material participation.
Thank you. I'll go back and change my answer about actively participating and see if that helps. Nobody actively participates other than to clean up between guests, resupply, and maintain the property.
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