As someone who just went through this process last month, I can confirm everything others have said - you can definitely e-file your regular tax return and mail Form 709 separately. That's exactly what I did when I gifted $20,000 to my son for his business startup. One thing I learned the hard way: make sure you complete Part 2 of Form 709 correctly if this is your first time filing a gift tax return. The form asks about previous gift tax returns, and I initially left it blank thinking it didn't apply to me, but you actually need to check the "No" box to indicate you haven't filed before. Also, don't stress too much about owing gift tax - with the current lifetime exemption being over $12 million, you're just using up a small portion of that exemption. The Form 709 is really just for reporting purposes in most cases. The hardest part is honestly just remembering to mail it to the correct processing center!

Just wanted to chime in as someone who's helped several family members through this process! You're absolutely correct that you can e-file your regular 1040 and mail Form 709 separately - that's the standard approach since 709s can't be e-filed. One thing I'd add to all the great advice here: when you're preparing Form 709, pay close attention to the gift description section. Since you mentioned this was for your niece's college fund, you can simply describe it as "Cash gift for educational expenses" - keep it straightforward but specific enough that it's clear what the gift was for. Also, even though your $18,000 gift exceeds the annual exclusion, remember that you're not necessarily going to owe any gift tax. You're just using a small portion of your lifetime gift tax exemption (which is currently $12.92 million for 2023). The Form 709 is really just a reporting mechanism to track your cumulative gifts over the annual exclusion amount. Make sure to file by the April deadline, and keep copies of everything for your records. The process is much more straightforward than it seems at first glance!

I went through this exact situation when my father passed last year. The insurance companies are likely withholding taxes because they're being overly cautious or have automated systems that don't properly distinguish between different types of payouts. Here's what I learned: The 10% withholding is probably happening because the insurance company is treating this like a retirement account distribution rather than a life insurance death benefit. This is a common error, especially if the policies had any investment components or if there was a delay between death and payout that generated interest. My advice: Contact each insurance company directly and ask them to provide a detailed breakdown showing the death benefit amount versus any interest or earnings. Request corrected 1099 forms if they misclassified the payout. Most will cooperate once you point out the error. If they won't budge, you'll definitely get the money back when you file your taxes. Just make sure to report the withholding on your return - the IRS will credit you for taxes that shouldn't have been withheld in the first place. I ended up getting back about $8,500 in my refund from similar overwithholding.

I'm dealing with a very similar situation right now with my grandmother's life insurance policies. Two smaller policies withheld taxes while the larger one didn't, and I was completely confused about why. After reading through all these responses, it sounds like the insurance companies are making errors in how they classify these payouts. I'm definitely going to contact them directly with the death certificate and policy documents to request corrected 1099 forms. One question I have though - if there was interest that accrued between the date of death and payout, how do I figure out what portion of the withholding was legitimate (for the interest) versus what should be refunded (for the death benefit portion)? The insurance statements aren't very clear about breaking this down. Also, has anyone had success getting the insurance companies to actually admit they made an error and issue corrected forms? Or do they usually just tell you to handle it on your tax return?

Have you checked out FreeTaxUSA? Their Deluxe version ($7) covers personal returns really well, and they have a separate business version that handles 1065 partnership returns for about $60. Their interface is much cleaner than H&R Block and TaxAct, and they let you see the actual forms as you work. I've used them for my small partnership for two years now, and their step-by-step approach is perfect for DIYers. Plus their customer service usually responds within a day when you have questions. Major savings compared to paying an accountant for simple returns.

Quick warning about DIY partnership returns - don't forget about basis tracking! This is the one thing most software doesn't handle well. Your partnership basis changes every year based on contributions, distributions, and profit/loss allocation. If you don't track this correctly, you could have major issues down the road, especially if you ever take distributions or sell your partnership interest. Ask me how I know... ended up with a surprise tax bill because I didn't realize my basis was lower than the distributions I took.

I'm going through a similar situation right now with my uncle's life insurance policy from last year. After reading through all these responses, I called the insurance company this morning and asked specifically for their "1099 department" like Angelina suggested - what a difference that made! The rep was able to pull up my payout details immediately and confirmed that out of the $65,000 total I received, $2,100 was actually interest that accumulated during their 52-day processing period. She said they should have automatically sent me a 1099-INT for that interest portion, but there was apparently a system glitch that prevented some 2024 forms from being mailed out. They're expediting a corrected 1099-INT to me within 5 business days. I had no idea I was supposed to report that interest - I would have completely missed it on my tax return! Really grateful for everyone sharing their experiences here, especially the tip about asking for the specific department that handles tax documents. For anyone else dealing with this, definitely request that itemized breakdown showing the death benefit separate from any interest. Don't just assume the entire payout is tax-free like I initially did.

I went through this exact situation with my grandmother's life insurance payout last year. Like others have mentioned, the death benefit itself ($78,000 in your case) is completely tax-free and won't generate a 1099 form - that's why you haven't received one. However, I'd definitely recommend calling the insurance company back and asking specifically for their "tax documents department" or "1099 department" as suggested by others here. When I did this, I discovered that my payout included about $1,800 in interest that had accumulated during their processing delay, which I needed to report as taxable income. The key is getting an itemized breakdown of your payout. Many companies will initially just show one lump sum, but they're required to separate out any interest portions if you request it. If there was any delay between your aunt's death and when you received the money (especially if it was more than 30-45 days), there's a good chance some portion was interest that should have generated a 1099-INT. Even if you don't receive the 1099-INT form, you're still required to report any interest as income on your return. Better to find out now than have issues later!

H&R Block is one of the most expensive options for a basic return like yours. I'm a married homeowner with W-2 income too, and I switched to TurboTax which was about $120 all in (federal + state). FreeTaxUSA is even cheaper at around $40-50 total. Unless you have some complicated situation you didn't mention, there's no reason to pay H&R Block prices. The mortgage interest deduction is super straightforward - you just enter the numbers from your Form 1098.

I went through this exact same situation last year! My wife and I both have W-2 jobs and we bought our first house in 2023. I called around to different H&R Block locations and got quotes ranging from $275-$350 for our return (married filing jointly with mortgage interest deduction). What really helped me was calling during their slower hours (mid-morning on weekdays) rather than evenings or weekends when they're swamped. I also asked specifically about any first-time homeowner discounts - one location offered $25 off. That said, after getting those quotes, I ended up using TurboTax Deluxe instead for about $100 total. The mortgage interest part was really straightforward - just had to enter the info from our 1098 form that the mortgage company sent us. Saved us almost $200 and I felt confident we did it correctly. If you're set on using H&R Block though, definitely call multiple locations in your area since pricing can vary between franchises.