Tax on flip crossing over tax years

[Mehul Desai]

Hello All,

My friends and I bought our first property to flip. All cash if it matters.  We put the property in one friend's name (no separate entity yet).  The house was bought in Ocotber 2015 and is now complete and on the market.  We're sure it won't sell before 2016.  My questions:

1. Does this affect our 2015 taxes or must we claim everything in 2016 after it is sold?  If it affects 2015 taxes, in what way?

2. How would we go about splitting the costs and profits for tax purposes if we each own an equal share?

Thank you,

Mehul Desai