Rental Arbitrage - Taxes

[Eric P.]

For those following a STR rental arbitrage airbnb strategy (or homeaway or vrbo), in which you're airbnb-ing places that you've rented from someone else (with the owner's / landlord's permission, of course): do you report the income on Schedule C or Schedule E when filing your taxes? I know that most people who OWN a property and put it on airbnb claim the income on Schedule E ("passive income"), which avoids having to pay the 15.3% self-employment tax.

I'm wondering if those who are practicing rental arbitrage by renting the place that they list on airbnb also claim the income on Schedule E, or if you claim it on Schedule C bc you don't own the place that you're listing on airbnb.

Whether you own or rent the property that you list on Airbnb, the activities are the same: acquiring the property, furnishing it, activating utilities, listing it on Airbnb, hiring cleaning services, etc, etc. Thus since in both cases you as a short-term landlord are merely providing basic services to your short-term guests (and receiving passive income in return), I would think this meets the requirements for Schedule E and I would think that you can report the income on Schedule E even if you don't own the property, thus avoiding the 15.3% self-employment tax? Any thoughts?