Trey is skilled at finding and purchasing real estate property at sub-market prices. He rarely owns these properties for more than a few months, as he prefers to make a few upgrades and then sell them at a profit. Occasionally, Trey buys a property with a tenant in residence, from whom he receives rent payments. How does Trey report this rental income on his tax return?

As not-for-profit income, reported on Form 1040, line 21.

As earned income, reported on Schedule C

. As investment income, reported on Schedule D.

As rental investment income, reported on Schedule E.