You're absolutely right that you can file Form 709 separately from your 1040! This is actually the most common approach since Form 709 must be paper-filed (no e-filing option available) while you can e-file your 1040 through TurboTax as usual. Your planned approach won't cause any issues with the IRS. Just make sure to: - Mail Form 709 to the correct IRS service center based on your state (check the form instructions) - Keep the same April 15th deadline for both forms - Consider using certified mail for Form 709 to have proof of delivery However, before you file Form 709, I'd definitely verify whether it's actually required in your situation. You mentioned paying for your nephew's college tuition directly to the school - if you literally wrote the check to the educational institution (not to your nephew), this qualifies for the unlimited educational expense exclusion under Section 2503(e) of the tax code. This means no Form 709 would be needed regardless of the amount. The distinction is crucial: direct payment to school = no filing required, but giving money to your nephew who then pays = Form 709 needed if over the annual exclusion. If you're unsure about the exact payment method or have other gifts to report, it might be worth consulting with a tax professional to make sure you're handling everything correctly!

You can absolutely file Form 709 separately from your Form 1040 - that's actually the standard approach since Form 709 must be paper-filed while your 1040 can be e-filed through TurboTax as planned. Just a heads up though - before you go through the hassle of filing Form 709, you should double-check if it's actually required in your case. Since you mentioned paying your nephew's tuition "directly to the school," this could qualify for the educational expense exclusion under IRC Section 2503(e). If you literally paid the educational institution directly (wrote the check to the school, not to your nephew), then no Form 709 is needed regardless of the amount. The key distinction is: - Payment directly to educational institution = no Form 709 required - Money given to nephew who then pays school = Form 709 needed if over annual exclusion If you do need to file Form 709, make sure to mail it to the correct IRS processing center (check the form instructions for your state's address) and consider using certified mail for proof of delivery. Both forms share the same April 15th deadline. Hope this helps clarify things!

9 For what it's worth, I use FreeTaxUSA for both my personal taxes and my 1099-NEC filings. It's way cheaper than TurboTax and has been really reliable for my small business. They walk you through the process pretty clearly and the interface is straightforward. Just sharing another option that's worked well for me for the past couple years.

As someone who went through this exact same confusion last year with my small consulting business, I totally feel your pain! The IRS website is like a maze when you're trying to figure out electronic filing for the first time. One thing I learned the hard way - if you're filing more than 250 forms, you're actually REQUIRED to file electronically. But for smaller businesses like yours (and mine), you have options. I ended up using a combination approach: I used TaxAct's business version for the actual electronic submission (cost me about $40 for unlimited 1099s), but I also called the IRS Practitioner Priority Service line instead of the regular taxpayer line - the wait times were much shorter and I got through to someone who actually knew what they were talking about. The key thing to remember is that even if you're a few days late on the January 31st deadline, the penalties are usually pretty reasonable for small businesses filing just a handful of forms. Don't stress too much about being perfect your first year - we've all been there!

Another option nobody mentioned - you could also file Form 1116 Schedule B as a PDF attachment to your return. This works if your tax software won't allow you to complete just Schedule B without the main form. Just download the PDF form from the IRS website, fill it out manually, and then attach it to your e-filed return as a PDF supplement. Most tax software allows you to include supplemental forms this way. This might be cleaner than entering artificial foreign income data just to trigger the form. The key is making sure you have documentation of your carryover amounts for future use!

I went through this exact situation two years ago and can confirm that filing Form 1116 Schedule B is absolutely necessary to preserve your FTC carryovers, even when you have no foreign income for the current year. What really helped me was creating a simple spreadsheet to track all my carryovers by year and their expiration dates. Since FTC carryovers expire after 10 years, it's crucial to maintain clear records of when each carryover originated so you know when they'll expire. For the tax software issue that several people mentioned - I found that most software programs have a "forms mode" or "manual entry" option that lets you add forms without going through the interview process. In TurboTax, you can search for "Form 1116" and add it directly, then just complete Schedule B without filling out the main form sections. One important note: make sure your Schedule B carryover amounts match what you reported in previous years. The IRS computers will flag any discrepancies, so consistency in your carryover tracking is key. I learned this the hard way when I had to amend a return because my carryover amounts didn't match my previous year's filing.

I've been working as a tax preparer for over 15 years and see this Direct Pay issue constantly during tax season. The system has gotten worse over the years, not better. Here's my professional recommendation based on what usually works: **Immediate solution for your deadline:** Call 1-888-PAY-1040 and pay the $3.99 fee. It processes instantly and you'll have a confirmation number within minutes. Don't risk penalties over a few dollars. **For future reference:** The most common cause I see for these generic rejections is mismatched personal information between your tax return and bank account. Even something as simple as having "Robert" on your tax return but "Bob" on your bank account will cause a silent failure. **Quick diagnostic test:** Before trying Direct Pay again, call your bank and ask them to read back exactly how your name appears on the account. Compare that word-for-word with how it appears on your tax return. Also verify they haven't flagged any IRS payment attempts as fraud. The IRS payment systems are notoriously unreliable, especially near deadlines when traffic is heavy. You're doing everything right - the system is just poorly designed. Don't let it stress you out when there are reliable paid alternatives available. Good luck getting this sorted out!

I've been following this thread and wanted to share something that might help - have you tried using a completely different device altogether? I had a similar issue last year where Direct Pay kept failing on my laptop, but when I tried the exact same payment information on my tablet, it went through immediately. Sometimes the issue isn't with your browser or personal information, but with device-specific settings like ad blockers, VPNs, or even certain antivirus software that can interfere with the IRS payment portal. My Norton antivirus was actually blocking part of the payment process without giving me any error messages about it. Also, if you haven't already, try temporarily disabling any browser extensions (especially password managers, ad blockers, or privacy extensions) before attempting the payment. These can sometimes interfere with the form submission process on government websites. Given that your deadline is so close though, I'd echo what the tax professionals here have said - the $3.99 phone payment fee is absolutely worth it for the immediate confirmation and peace of mind. You've already put in way more effort than should be necessary for what should be a simple payment process!

This entire discussion has been incredibly eye-opening! I'm a tax preparer and see so many small businesses getting this wrong every tax season. One additional point I'd like to add - make sure you're also considering the impact on your workers' compensation insurance if you switch to reimbursements. Some states include stipends in the calculation of workers' comp premiums because they're treated as wages, but properly structured reimbursements under an accountable plan typically aren't included. This could be another small cost savings to factor into your decision. Also, for anyone implementing this change - don't forget to update your employee handbook and have clear communication about the new process. I've seen employees get confused when their paychecks change, even when it's beneficial to them. A simple explanation showing how the reimbursement approach saves them money on taxes goes a long way toward getting buy-in. One last tip: if you're using payroll software, make sure it can handle accountable plan reimbursements properly. Some basic systems struggle with this and might incorrectly include the reimbursements in taxable wages. It's worth double-checking with your payroll provider before making the switch. Thanks to everyone who shared their experiences - this is exactly the kind of practical, real-world guidance that helps businesses navigate these complex tax rules!

This thread has been absolutely fantastic! As someone who just discovered this community while researching tax implications for our company's remote work benefits, I'm blown away by the quality of insights shared here. I work for a mid-size tech company (about 80 employees) and we've been providing a flat $100 monthly "connectivity allowance" that covers both internet and phone expenses. After reading through all these comments, I'm realizing we're probably doing this in the most tax-inefficient way possible! A few quick questions for the group: 1. For companies that bundle internet AND phone reimbursements - do you handle them as separate line items or one combined reimbursement? 2. Has anyone dealt with international remote employees? We have a few team members in Canada and the UK, and I'm wondering if the accountable plan approach works the same way for them. 3. The geographic tiering that Gabriel mentioned is brilliant - has anyone implemented this successfully with payroll systems like ADP or Workday? I'm definitely going to bring this discussion to our finance team. The potential savings on payroll taxes alone could be substantial across our headcount. Plus, our employees would benefit from not having these reimbursements treated as taxable income. Thanks to everyone who shared their expertise - this is exactly the kind of practical, actionable advice that makes these online communities so valuable!