Flipping as S-corp Tax Question

[Alex S.]

I have a tax question. My accountant of 12 years does not have any clients that flip houses, she has buy and hold but no flippers. Also her father was actually my accountant for 10 years and he passed, so she took over. For 12 years I have operated as an s-corp, on my 1120 schedule B, it has business activity contractor and service. So here is my first question

1) For the last two years most of my income has come from flipping the properties that I buy, I am a licensed contractor, but I rarely work with customers anymore. I flip about 4 a year, so am I now a dealer and no longer a contractor? Do I need to change my business activity on my taxes? She suggested separating the two, creating another s-corp. 

2) Last year she put the properties that I purchased on form 4797 under ordinary gains and losses. Is that right? Or should everything go up under gross receipts (1a) and all my deductions/expenses (such as materials, light bills, subs , etc) come out on line 2 which is cost of goods? My first year in 2016, I did not disclose to her that I flipped a house I just included it in my gross receipts and subtracted my expense, I did not think it mattered until she put it under something different in 2017 taxes, which is the 4797 form

3) I am about to close the year out with less in my account because I have three properties that I purchased and waiting to sell. One of the properties I have a loan, the other two I paid for with my funds out of my account. Are those considered inventory? Or would it be a write off under cost of goods? One is a vacant lot and will be new construction, not sure if that matters or not. So I will show a loss this year, because my funds were spent on buying properties and they have not sold. I am guessing that will count as a loss , but maybe not if the properties are considered inventory.

Thanks for any advice in advance