Taxes for Recent Flip

[Jeff Brigham]

Hi all,

My partner and I created an LLC and are in the midst of completing our first flip. Our business plan and intent is to continue flipping houses to build up capital for larger multi home flips and holds. As a result our flip projects will be recognized as ordinary income. My question is for the tax gurus out there!

We purchased our first house on Dec. 20th and decided a quick flip would be the most profitable.  We were able to flip the house in 8 days and have a buyer by Jan. 4th.  The closing date is set for Feb. 10th.  As a result we our running at a net loss for 2016 from the rehab costs. 

Do these losses carry over to 2017 real estate gains?

OR

Since we are in the flipping business and are losses are considered ordinary loss, do we write it off of our ordinary income from our day jobs?

Thanks!

Jeff