Of course, the more the merrier in reserves, but anything over 6 months is excessive IMO and reduces your ability to take on new projects.A common mistake I see is buyers not putting the tax credit they received at closing into reserves.

I knew they were common in retail buys, just wasn't sure about flipping.

There may be a few legitimate ones, but that is not a common practice here in CA, and there are as many bad stories as good.

On the w9, you can only charge taxes on materials, you can't charge taxes on services, if you are paying cash (CA common practice, not saying it is legal) and expect to pay cash, then you're simply a licensed contractor doing an unlicensed activity (under the table).

Undisclosed liens are common, part of the business and you should expect them, no?

Always looking for meet local folks with common interests...

We seem to have a lot in common.

I may be in error using "all", please excuse that.Absolutely a wholesaler can act professionally, with integrity, deal honestly, in good faith, with valid contracts and fair valuations, but they aren't if they simply tell a seller they are  buying, then chase off looking for areal buyer, assign the contract with their hand out!

Yes, it can be toxic/dangerous, but it can also be extremely common and natural.  

If it's not common for houses in your competitive bracket, I would skip it altogether.