Active vs Passive VR Income, If active, can you claim losses?

[Leigh Ann Smith]

I've been reading all the IRS pubs about rentals in general and specifically about VR's.  We are a sole proprietorship. Since we plan to handle all of the management ourselves, we will be providing "substantial services", so it seems that it will be filed on Schedule C as business income rather than Schedule E as rental income.  When you do that, do you claim losses as ordinary business losses? Since we're just getting started, we will have a net loss for 2015, but I'm reading about passive losses with rental income, and how you can't use those losses to offset regular income.