What do Flippers do with the profits?

[Glenn McCrorey]

When I watch TV shows about flipping houses and the big profits they make, I wonder if they are paying taxes as the go, or using 1031 exchanges on every one.  My wife is a realtor and about half of what she makes goes towards taxes which she pays quarterly.  Just curious so thought I would ask the BP flippers.

[Dave Foster]

Fixing and Flipping like you do on TV is an ordinary income activity.  It is not eligible for 1031 treatment because the demonstrated intent is purchasing a property primarily for re-sale.

I gotta think the TV contracts are lucrative enough that they're not too worried about margins.  The money's in the entertainment and endorsements.  The rest of folks are not so lucky and have to work to increase margin.