I'm surprised nobody's mentioned the college's institutional methodology yet! The FAFSA is just the federal formula, but many private universities have their own additional financial aid forms (like the CSS Profile) that absolutely DO ask who claims the student as a dependent on taxes. If your sister attends a school that uses the CSS Profile or their own institutional aid form, they will likely find out regardless of FAFSA verification. Many private schools give out significant institutional aid that follows different rules than federal aid. Does her school require the CSS Profile or have their own separate financial aid application?

This is a tricky situation that I've seen play out badly for families before. The math seems tempting - $12,500 difference in your tax refund - but you need to consider the full picture. Here's what could happen: Your sister's school could require your financial information during verification if they discover you're claiming her as a dependent. With your six-figure income, her Expected Family Contribution (EFC) would likely increase dramatically, potentially reducing her aid by much more than your tax savings. My suggestion would be to contact her financial aid office directly and ask them hypothetically: "If a sibling with [your income level] claimed the student as a dependent for tax purposes, how would that affect the student's aid package?" Don't mention it's your specific situation if you're uncomfortable, but get a concrete answer. Also consider that this isn't just about this year - if you start claiming her now, it creates a pattern that could affect her aid for the remainder of her college years. The short-term tax benefit might not be worth the long-term financial aid consequences. Have you calculated what her potential aid reduction might be with your income factored in? That comparison would give you the real numbers to make this decision.

Has anyone used TurboTax or H&R Block for filing estate tax returns? I'm wondering if the software can handle Form 1041 or if I should just hire a professional.

I went through this exact situation when my mother passed away last year. Based on what you've described, you'll definitely need to file Form 1041 since the estate had income from the house sale and the CD interest that exceeded $600. A few important points to remember: 1. The house sale will likely qualify for stepped-up basis, meaning the estate's "cost" for tax purposes is the fair market value on the date of your dad's death, not what he originally paid. This could significantly reduce or eliminate the taxable gain. 2. Make sure to get a professional appraisal of the house as of the date of death if you don't already have one - you'll need this to establish the stepped-up basis. 3. The estate's first tax year can end on December 31st of the year of death, or you can choose a fiscal year ending up to 12 months after the date of death. This gives you flexibility on when the first return is due. 4. Don't forget that if you distribute any income to beneficiaries during the tax year, you'll need to prepare Schedule K-1s for them. The good news is that with the stepped-up basis, you may owe very little or no tax on the house sale. I'd recommend consulting with a CPA who has estate experience, especially for the first year - the peace of mind is worth it.

I'm going through something very similar right now! Filed on 2/15 and got the same 810 freeze code with no verification needed according to the IRS rep I spoke with. It's so nerve-wracking when you need the money for important expenses. From what I've learned lurking in this community, the 810 freeze is actually pretty routine during busy filing seasons - the IRS's automated systems flag returns for review based on various factors that aren't necessarily red flags. It could be anything from certain tax credits you claimed to income thresholds that trigger their review algorithms. Since you're dealing with the added stress of an international move, I'd definitely echo what others have said about making sure your banking info will stay valid and setting up that online IRS account for monitoring from abroad. Also, maybe consider calling again in about a week just to double-check - sometimes different reps see different information in the system. The waiting is absolutely brutal, but from all the posts I've read here, most people see their 810 freezes lift within 2-3 weeks. You filed around the same time as me, so hopefully we'll both see some movement soon! Hang in there! 🤞

I can totally relate to your frustration, Emma! The 810 freeze without verification is actually quite common this time of year - the IRS uses automated screening that can flag returns for various reasons that don't necessarily require action from you. Given your international move timeline, here's what I'd prioritize: First, definitely set up your IRS online account at irs.gov if you haven't already - this will be crucial for monitoring things from abroad. Second, consider calling your bank to confirm they won't close your account when you move internationally (some do, others just require notification). Third, file Form 8822 to change your address before you leave, and maybe set up mail forwarding just in case. The timing should actually work in your favor! Most 810 freezes I've seen resolve within 14-21 days, and since you filed on 2/12, you're right in that window. I know the daily checking is tempting (been there!), but try to limit it to maybe once a week to preserve your sanity. One last thought - if you can swing it financially, maybe prepare for the possibility that the refund might come a week or two after your move. Having that backup plan might reduce some of the stress while you wait for the system to do its thing. You've got this! 💪

I know this doesn't answer your question directly, but if you're worried, you should gather all your documentation now so you're prepared if/when you do get a letter. Get a copy of the settlement agreement showing it was for personal injury, the 1099-MISC the law firm issued, and maybe even a written statement from either CPA explaining why it wasn't taxable. The IRS usually gives you 30 days to respond to a CP2000 notice, which can feel really rushed if you're scrambling to find paperwork from 2-3 years ago!

Great advice from everyone here! Just to add another perspective - I went through something similar with a workers' comp settlement in 2021. The IRS sent me a CP2000 notice about 16 months after I filed, even though workers' comp settlements are clearly non-taxable under IRC Section 104(a)(1). What really helped me was having everything organized beforehand like Ethan suggested. I had copies of the settlement agreement, the court order approving it, and a letter from my attorney explaining the tax treatment. When the notice came, I was able to respond within a week with all the supporting documentation. The key thing I learned is that the IRS automated matching system doesn't distinguish between taxable and non-taxable income reported on 1099s - it just sees a mismatch and generates a notice. But once you provide the proper documentation showing why the income isn't taxable, they usually close the case pretty quickly. Mine was resolved in about 6 weeks after I sent my response. Don't stress too much about it - you have legitimate grounds and good documentation. Just be prepared to explain your position clearly if they do contact you.

Now the message at the top is new. But I still don’t have code 846

Based on your situation, it sounds like you're in a really good spot! The 766 code with the 4/15 date is essentially the IRS saying "we owe you this money and plan to send it on this date." Since your education credit hasn't been added yet, that's likely what's causing the amount discrepancy you're seeing. The process usually goes: 766 codes show up first (like yours), then once all the credits and adjustments are finalized, you'll see the 846 code with your actual deposit date. The 846 is the "money's on its way" code. I've seen tons of people in your exact situation - the amount changes multiple times before that final 846 appears, especially with education credits since those take extra verification. Don't stress about the current amount showing, it's definitely going to adjust once they add your education credit. You should see that 846 code pop up within the next week or so, and then your deposit usually follows 1-3 business days after that. The fact that you already have a 766 with a date means they're actively working on your return, which is great news!