Form 1098: Mortgage Interest Statement

Form 1098 is generally used to report certain mortgage interest received during the year and provide information that may be relevant to a taxpayer's federal tax return.

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Introduction

Form 1098, Mortgage Interest Statement, is generally used by certain mortgage lenders and other recipients of mortgage interest to report qualifying mortgage interest received during the year. The form provides information that may be used by homeowners when preparing their federal income tax returns.

A taxpayer who receives Form 1098 should review the information and keep the form with their tax records. Whether the reported mortgage interest affects a taxpayer’s federal tax return depends on the taxpayer’s individual circumstances and applicable tax rules.

What Is Form 1098?

Form 1098 is an information statement used to report certain mortgage interest received during the year. It generally provides the recipient’s identifying information, the amount of qualifying mortgage interest, and other information that may be relevant to the taxpayer.

Form 1098 is generally prepared by the mortgage lender or other applicable recipient of the mortgage interest. The taxpayer receiving the form may use the information when determining whether mortgage interest is relevant to their federal income tax return.

Who Uses Form 1098?

Form 1098 may be used by certain mortgage lenders and other applicable recipients of mortgage interest when reporting qualifying mortgage interest. Homeowners and other taxpayers who receive the form may use the information when preparing their federal income tax returns.

Not every mortgage or loan results in a Form 1098. Whether a form is provided depends on the type of loan, the amount of interest, and other applicable reporting requirements.

What Information Is Needed?

The information on Form 1098 generally includes the payer’s name and identifying information, the recipient’s information, and the amount of mortgage interest received during the year. Other information may also be included when applicable.

Taxpayers should compare Form 1098 with their mortgage statements and payment records. Keeping these records can help verify the amount reported and support information used when preparing a federal income tax return.

How to Fill Out/Complete Form 1098

Form 1098 is generally completed by the mortgage lender or other applicable recipient rather than by the homeowner. The form is prepared using the mortgage account and payment records for the applicable reporting period.

Taxpayers who receive Form 1098 generally use the information provided on the statement when preparing their tax return. Both the recipient and taxpayer should review the information for basic accuracy and address apparent errors with the appropriate party.

Section 1

Enter the payer and recipient identifying information requested on Form 1098. This information generally identifies the individual or entity that made the mortgage payments and the lender or other recipient reporting the interest.

Review names, addresses, and taxpayer identification information carefully. Accurate identifying information can help ensure that the statement is associated with the correct taxpayer and mortgage account.

Section 2

Enter the applicable mortgage interest received during the reporting period. The amount should generally be based on the mortgage lender’s records for qualifying interest payments.

Review the reported interest amount against available mortgage statements and payment records. Taxpayers should retain supporting records with their other tax documents.

Section 3

Enter any additional information requested on Form 1098 that applies to the mortgage or reporting situation. The information required may vary depending on the circumstances of the loan.

Review the applicable fields carefully and provide accurate information based on the lender’s records. Not every field will apply to every mortgage.

Section 4

Complete any applicable information concerning mortgage-related amounts or circumstances requested by the form. This may include additional information relevant to the mortgage or the reported interest.

The information should be reviewed for consistency with the mortgage account records. Taxpayers should compare the completed statement with their own records when possible.

Final Review

Review Form 1098 after all applicable information has been entered. Check the payer’s information, recipient’s information, mortgage interest amount, and any other reported amounts.

A final review can help identify simple reporting errors before the statement is furnished or used to prepare a tax return. Taxpayers should retain Form 1098 with their mortgage and tax records.

Common Mistakes

Common mistakes involving Form 1098 may include reporting an incorrect mortgage interest amount, entering incorrect identifying information, or failing to properly account for mortgage-related information.

Another common mistake is assuming that every amount shown on Form 1098 automatically creates a tax deduction. Whether mortgage interest is deductible depends on the taxpayer’s circumstances and applicable tax rules.

Related IRS Forms

Form 1098 may be associated with Form 1040 and other federal tax forms and schedules used when reporting or claiming certain home-related tax items. The information on Form 1098 may be relevant when determining whether mortgage interest can be included on a federal income tax return.

Other versions of Form 1098 may be used for different types of payments or reporting situations. The specific form required depends on the type of transaction and the information being reported.

Where to File or Submit

Form 1098 is generally prepared by the mortgage lender or other applicable recipient and furnished to the taxpayer when required. The taxpayer generally does not submit Form 1098 as a separate federal tax return.

When applicable, the taxpayer uses the information from Form 1098 when preparing their federal income tax return. The taxpayer should retain the statement with their mortgage and tax records.

Current IRS Form & Instructions

Tax forms and instructions may change over time. Mortgage lenders and taxpayers should use the version of Form 1098 that applies to the applicable reporting period and tax year.

The information on this page is intentionally general so it can remain useful across multiple tax years. Before preparing or using Form 1098, users should review the applicable version of the form and its instructions because reporting requirements, mortgage rules, and other tax procedures may change.

Important Information / Disclaimer

This page is provided for general informational and educational purposes and offers a basic overview of Form 1098. It is not intended to provide individualized tax, legal, accounting, mortgage, or financial advice and should not be considered a substitute for professional guidance.

Federal tax laws, forms, mortgage interest rules, information reporting requirements, and filing procedures may change over time. Information that applies to one taxpayer, lender, mortgage, or tax year may not apply to another, so users should consider their individual circumstances and seek assistance from a qualified tax professional when appropriate.