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.

In case anyone's interested in the technical reason this happened - the IRS computer systems actually do allow for early filing of future tax years in some circumstances (like military deployments or people leaving the country long-term). That's probably why the system didn't automatically reject the return.

This is definitely a stressful situation, but you're handling it the right way by trying to fix it proactively! I had a similar mix-up a few years ago (though not quite as dramatic as filing for a future tax year). From what I've seen in this thread, it sounds like you have a few good options - either calling the IRS directly or returning the refund with a detailed letter. If you're comfortable navigating phone systems, calling might give you the most clarity since they can put immediate notes on your account. But if you prefer the paper trail approach, Sean's suggestion about mailing a check with explanation seems solid too. The main thing is don't panic about this - the IRS really does understand that honest mistakes happen, especially during busy filing season when people are rushing to get everything submitted. The fact that you caught this yourself and are taking steps to correct it will work in your favor. Keep documentation of whatever method you choose to fix it, and you should be fine!

Ugh I got audited last year and this exact issue came up. My advice is to take photos of ALL receipts where you claimed business expenses and store them digitally by date. I had to go through hundreds of receipts during my audit and the ones I couldn't find or that were too faded to read were automatically disallowed as deductions.

Great thread! I'm dealing with this exact same situation with my freelance graphic design work. One thing I learned from my accountant is that you should also keep a simple business expense log alongside your receipts. Just a spreadsheet with columns for date, vendor, total amount, business portion, and business purpose. This way if you ever get audited, you're not just relying on highlighted receipts - you have a clear paper trail showing your thought process for each deduction. The IRS loves documentation that shows you were being deliberate and organized rather than just guessing. Also, don't forget that you can deduct the business portion of things like gas when you're making those mixed shopping trips! If you drove to Target specifically to buy business supplies but also grabbed personal items while there, you can still claim the mileage as a business expense.

doesn't anyone else think its crazy that we gotta jump through all these hoops for some tax savings?? i'm flipping houses in florida and just use an LLC, keep it simple. my buddy went S-corp and now he's spending like 5 hrs a month just on paperwork. not worth it imho unless ur making big $$$.

Great discussion everyone! As someone who's been flipping properties for about 5 years now, I can confirm that the S-Corp election sweet spot is usually around $75k-100k+ in annual profit. Below that, the administrative burden often outweighs the tax savings. One thing I'd add is timing - if you're just starting out and not sure about your profit levels, you can always begin with a regular LLC and make the S-Corp election later when your business grows. Just remember the election deadline is March 15th (or within 75 days of forming your LLC if it's a new entity). Also, don't forget about state taxes! Some states don't recognize S-Corp elections or have additional fees/taxes for S-Corps. In my state (California), there's an additional $800 franchise tax for S-Corps regardless of income, which needs to be factored into your calculations. For those flipping 3-4 properties annually with $60k-75k profit per property like the OP, you're definitely in the range where S-Corp election could make sense, but I'd strongly recommend running the numbers with a tax professional first.