The 1098 is a form that reports mortgage interest and property taxes you paid during the year

The Form 1098 is an information return your mortgage lender sends you each January. It reports the mortgage interest and property taxes you paid in the previous calendar year. You use this form to claim deductions on your federal tax return if you itemize rather than take the standard deduction.

Your lender is required to send you a 1098 if you paid $600 or more in mortgage interest during the year. The form shows the total interest paid, the outstanding principal on your loan as of January 1, and any property taxes the lender paid on your behalf from an escrow account. You receive Copy B to file with your tax return; your lender keeps Copy A for their records.

Not every homeowner receives a 1098. If your mortgage interest for the year was under $600, your lender may not send one, though some do anyway. If you paid off your mortgage during the year, you will still receive a 1098 for the months you held the loan. Renters do not receive a 1098 because they do not pay mortgage interest.

Key Takeaways

  • The 1098 reports mortgage interest and property taxes paid during the year and comes from your mortgage lender by January 31.
  • You need a 1098 only if you itemize deductions on your tax return; if you take the standard deduction, the form does not affect your taxes.
  • The form shows four key numbers: total mortgage interest paid, principal outstanding, property taxes paid, and points paid on the loan.
  • If you do not receive a 1098 by early February, contact your lender directly to request it or ask whether one was issued.

What information appears on the 1098

The 1098 contains several boxes, each reporting a different piece of information about your mortgage. Box 1a shows the total mortgage interest you paid during the year. Box 1b shows any points you paid upfront to reduce your interest rate. Box 2 reports property taxes your lender paid from your escrow account. Box 3 shows the outstanding principal balance on your loan as of January 1 of the current year.

The form also includes your loan number, the address of the property, and your lender's name and tax identification number. Some lenders include additional information in boxes 4 through 9, such as mortgage insurance premiums or amounts paid toward principal. The exact boxes used depend on your loan type and what you paid during the year.

If you have multiple mortgages on the same property or mortgages on different properties, you will receive a separate 1098 for each loan. If you refinanced during the year, you may receive two forms—one from your original lender and one from your new lender—each reporting interest for the months you held that loan.

Who receives a 1098 and who does not

You receive a 1098 if you are the borrower on a mortgage and your lender is required to report your interest payments. Most homeowners with conventional mortgages, FHA loans, VA loans, and USDA loans receive one. If you co-own a property with a spouse and both names are on the mortgage, your lender typically sends the form to the first-named borrower, though you can request a copy.

You will not receive a 1098 if you own your home outright with no mortgage. If you have a home equity line of credit (HELOC) or a second mortgage, you may receive a separate Form 1098 for that loan if the interest paid exceeds $600. Renters never receive a 1098 because they do not pay mortgage interest to a lender.

If you paid less than $600 in mortgage interest during the year—for example, because you paid off the loan early or because the loan balance was very small—your lender may not be required to send a 1098. However, you can still deduct the interest you actually paid if you itemize. Contact your lender for a statement of the interest paid if you do not receive a form.

How to use the 1098 when filing your taxes

The 1098 is useful only if you itemize deductions on Schedule A of your federal tax return. If you take the standard deduction instead, the information on the 1098 does not reduce your taxable income. Most taxpayers use the standard deduction because it is larger than their itemized deductions, so they never need to reference the 1098.

If you do itemize, you report the mortgage interest from Box 1a on Schedule A, Line 8. You report property taxes from Box 2 on Line 5a, though there is a limit of $10,000 per year for all state and local taxes combined (including income tax, sales tax, and property tax). Points paid to reduce your interest rate, shown in Box 1b, may be deductible in full in the year paid or deducted over the life of the loan, depending on whether they were paid at closing or later.

Keep your 1098 with your tax records for at least three years. The IRS may ask to see it if you are audited. If the form contains an error—for example, if the interest amount is wrong—contact your lender when ready to request a corrected form, called a Form 1098-X.

What to do if you do not receive a 1098

Mortgage lenders are required to mail the 1098 by January 31 each year. If you do not receive one by early February, contact your lender's customer service department. Many lenders allow you to read a copy from your online account or request one by phone. Some lenders post the form to your account portal before mailing the paper copy.

If your lender cannot locate a 1098 for you, ask them to provide a written statement of the mortgage interest and property taxes paid during the year. You can use this statement to support your deduction on your tax return even without the official form. Keep the statement with your tax records.

If you filed your return before receiving the 1098 and the information differs from what you reported, you can file an amended return using Form 1040-X. However, if the difference is small and you took the standard deduction, amending may not be necessary because the 1098 does not affect your taxes in that case.

The difference between a 1098 and other mortgage-related forms

The 1098 is sometimes confused with the Form 1098-T, which reports education expenses, or the Form 1098-C, which reports charitable vehicle donations. These are entirely different forms for different purposes. The standard mortgage form is straightforward called the 1098.

You may also receive a Form 1099-INT if you earned interest on a savings account or other investment. This is not related to mortgage interest and serves a different tax purpose. The 1098 is specific to mortgage lending and is the only form you need for reporting home loan interest.

If you refinanced your mortgage, your new lender will send you a 1098 for the interest paid after the refinance closes. Your original lender will send a 1098 for the interest paid before the refinance. You report both on your tax return in the year of the refinance.

Frequently Asked Questions

Do I need to attach the 1098 to my tax return?

No. You do not send the 1098 to the IRS with your return. You keep it in your records. The IRS receives a copy directly from your lender. If you are filing electronically, your tax software will ask you to enter the information from the form, but you do not upload or mail the form itself.

What if I paid mortgage interest but my lender did not send a 1098?

If you paid $600 or more in interest, contact your lender and request the form or a statement of interest paid. If you itemize deductions, you can report the interest you actually paid even without the 1098, but having documentation is important if you are audited. If you paid less than $600, you can still deduct it if you itemize.

Can I deduct mortgage interest if I take the standard deduction?

No. The standard deduction is a single amount that covers all deductions. If you take it, you cannot also deduct mortgage interest, property taxes, or other itemized deductions. You must choose one or the other. Most people benefit from the standard deduction because it is larger than their itemized deductions would be.

Does my spouse need a copy of the 1098 if we file jointly?

Only one copy is needed for your joint return. Your lender sends the form to the first-named borrower on the loan. Both spouses can use the same form when filing jointly. If you need a second copy for your records, you can request one from your lender.

What if the 1098 shows the wrong amount of interest?

Contact your lender when ready and ask them to verify the amount. If an error is found, they will send you a corrected Form 1098-X. Do not file your tax return until you have the correct form. If you already filed and the amount was wrong, you can file an amended return.