Yes, as explained above, this isn't something you have to worry about (except as it might affect a mortgage application).

To clarify:

1) no matter what, you don't pay gift or estate taxes, the person (or estate) that is giving the money might
2) the $17k per person limit is on the amount that the person giving has to report. The estate and gift tax exemption is about $13 million. If the total estate is below $13 million, then the gifter just has to track and report amounts gifted above $17k, but doesn't owe taxes on it. If the estate is above $13 million, then amounts gifted above that $17k limit may be included in the taxable amount.

Presumably when your father passes, you/he will want to keep the inheritance as a non-marital asset. If he gifts 17k to you and 17k to your partner, the money effectively becomes a shared asset since you both own half.

With a little more work, he can write you a single check for 35k and file a Form 709 with the IRS. This is not difficult and will not have any negative tax implications unless his estate is worth more than ~13M.

Ideally you would setup a trust for the 35k gift and have the trust hold a 35k stake in the new home. That is not really needed since in the case of a messy divorce, a forensic accountant can follow a check into a joint account and a corresponding check out for the down payment and prove that the funds are not commingled.

Limit is $17k, so pp is correct for a $34k gift but not $35k

None would be applicable in this instance. Just split it into two checks, one to you and one to DH.

The first $17,000 each incurs neither a tax nor a reporting obligation. So that's $34,000. Technically, the next thousand would need to be reported by your dad and count against his lifetime gift tax exclusion. But you can get around that by limiting the gift to the $34,000 or straddle years.

It might have more of an effect on your mortgage application, depending on the timing of the gift. If it's given near the time of purchase, the lender will require a gift letter from your dad stating the money doesn't need to be paid back.

Your dad can give away 17K/person each year as a gift with no reporting requirement or tax.

He can give you and your husband $17K each and $1K to your kids (or just give you $1K in cash). You can use that money as down payment.

No taxes. He gives you 1/2 and your husband 1/2. If he’s married, he can give you the whole thing.

DH and I have never received any kid of family help with money for college, home, our kids, etc.

We are in the process of buying a lake house and my dad told me this morning that he would like to give me $35k early inheritance towards the down payment. How do taxes work for gifted money?