Try timeout harder. Maybe only make it for 5 to 10 minutes, but it has to be in a place where they can't play with toys, watch TV, etc. Explain to them why they are being placed in Timeout and eventually they will come to realize that their negative actions cause them to be deprived of playing time. Increase the length of time if need be.
You may have previously spoiled them so that they don't mind you. Just be forceful and patient. You will gradually see them spending less time in timeout and more in constructive play.
You're the adult. Don't let them control you.
Simply a Rose to brighten your day,
And maybe lessen the cares in your way;
And also, too, to help you to know,
That in knowing you, many others grow!