The 1098 is a statement from your lender showing how much mortgage interest and property taxes you paid in a year
The Form 1098 is a tax document that your mortgage lender sends you each January. It reports the mortgage interest and real estate property taxes you paid during the previous year. You use this form to claim deductions on your federal tax return if you itemize deductions instead of taking the standard deduction.
Not every homeowner receives a 1098. You get one only if you have a mortgage loan and paid at least $600 in mortgage interest during the year. If you own your home outright or your interest payments fall below that threshold, your lender will not send you this form. Renters never receive a 1098 because they do not pay mortgage interest to a lender.
The 1098 comes in several versions depending on your loan type. The most common is the standard 1098 for a traditional mortgage. Other versions include the 1098-T for education expenses and the 1098-C for charitable vehicle donations, but those are separate forms with different purposes.
Key Takeaways
- Your mortgage lender sends you a 1098 by January 31 each year if you paid at least $600 in mortgage interest the previous year.
- The form shows your mortgage interest paid and property taxes paid, which you can deduct on your tax return if you itemize deductions.
- The 1098 reports only what you actually paid, not what you owe, so the amount changes each year as your loan balance decreases.
- You must report the information from your 1098 on Schedule A if you itemize, or you can ignore it if you take the standard deduction instead.
What information appears on a 1098
The 1098 contains several boxes, each reporting a different piece of information about your mortgage. Box 1 shows the total mortgage interest you paid during the year. This is the main number most homeowners use for their tax deduction. Box 2 shows points paid on your mortgage, which are upfront fees that lower your interest rate and can also be deducted.
Box 5 reports real estate property taxes you paid, either directly to your local tax assessor or through an escrow account managed by your lender. Box 6 shows insurance premiums paid through escrow, though these are not deductible. The form also includes your loan account number, your lender's name and address, and your own name and address as the borrower.
Each box on the 1098 reports only what you actually paid during that calendar year, not what you owe or what your loan balance is. If you made extra payments toward principal, those do not appear on the 1098. The amounts reset each January 1, so a 1098 you receive in January 2025 covers only the year 2024.
Who needs to file a 1098 with their tax return
You must report your 1098 information on your tax return only if you itemize deductions on Schedule A. Itemizing means you add up all your deductible expenses—mortgage interest, property taxes, charitable donations, medical expenses—and deduct that total instead of taking the standard deduction. The standard deduction is a flat amount that changes each year based on your filing status and age.
For most homeowners, the choice between itemizing and taking the standard deduction depends on which gives you a larger deduction. If your mortgage interest plus property taxes plus other deductible expenses add up to more than the standard deduction, itemizing saves you money. If they add up to less, the standard deduction is better, and you do not need to report your 1098 at all.
You do not file the 1098 form itself with the IRS. Instead, you report the numbers from Box 1 (mortgage interest) and Box 5 (property taxes) on Schedule A, which you attach to your Form 1040. Your tax software will ask you to enter these amounts, or you can look them up on your 1098 and type them in by hand.
When you receive your 1098 and what to do if it is missing
Your lender must send you a 1098 by January 31 each year for the previous calendar year. If you do not receive it by early February, contact your lender's customer service line or log into your online account to request a copy. Many lenders allow you to read a copy from your account portal before the physical copy arrives in the mail.
If your lender cannot locate a 1098 for you, ask them to provide a written statement showing the mortgage interest and property taxes you paid. You can use this statement to report your deductions even without the official form, though you should keep the lender's written confirmation in case the IRS asks questions later.
If you received a 1098 but believe the amounts are wrong, contact your lender when ready. Common errors include interest or taxes from the wrong year, or amounts that do not match your payment records. Your lender can issue a corrected 1098 (marked as a correction) if they find a mistake. The IRS also receives a copy of your 1098, so the amounts on your tax return should match what the lender reported.
How mortgage interest changes your 1098 amount each year
The mortgage interest you pay decreases over time as your loan balance shrinks. Early in your mortgage, most of your payment goes toward interest, so your 1098 shows a high interest amount. As years pass and you pay down principal, less of each payment covers interest, so the 1098 amount gets smaller. This is why a homeowner in year 5 of a 30-year mortgage will see less interest on their 1098 than they did in year 1.
Property taxes on your 1098 may also change year to year, depending on your local tax assessor's decisions and any changes to your home's assessed value. If your lender collects property taxes through an escrow account, the amount they pay on your behalf appears on the 1098, not the amount you owe for the full year.
Refinancing your mortgage resets this timeline. When you refinance, you take out a new loan, and the old loan ends. Your 1098 for the year you refinance will show interest from both loans added together. Starting the next year, your 1098 will reflect only the new loan's interest, which may be higher or lower depending on the new loan terms.
The 1098 and your tax deduction decision
Receiving a 1098 does not automatically mean you should itemize deductions. You must compare the total of your itemized deductions against the standard deduction for your filing status. The standard deduction changes each year and varies based on whether you file as single, married filing jointly, head of household, or another status.
If you are married filing jointly and the standard deduction is $29,200 (the 2024 amount, which changes annually), but your mortgage interest plus property taxes plus other deductible expenses total only $24,000, you are better off taking the standard deduction. You would not report your 1098 at all in that case. If your deductions total $32,000, itemizing saves you $2,800 in taxable income, so you would report your 1098 on Schedule A.
Some homeowners find that they are close to the standard deduction amount and can benefit from bunching deductions in certain years. For example, if you are near the threshold, making an extra property tax payment in December instead of January might push you over into itemizing that year. This strategy requires planning with a tax professional and depends on your specific situation.
Frequently Asked Questions
Do I need to attach my 1098 to my tax return?
No. You report the numbers from your 1098 on Schedule A if you itemize, but you do not send the 1098 itself to the IRS. Your lender sends a copy directly to the IRS, and the IRS matches it against your return. Keep your 1098 with your tax records for at least three years in case the IRS asks questions.
What if I paid off my mortgage during the year?
Your lender will still send you a 1098 showing the interest and taxes you paid up to the payoff date. The amounts will be lower than a full year because you only paid for part of the year. You can still deduct this interest if you itemize.
Can I deduct mortgage interest if I take the standard deduction?
No. The standard deduction is an all-or-nothing choice. If you take the standard deduction, you cannot also deduct mortgage interest, property taxes, or other itemized deductions. You must choose one or the other, not both.
What if my 1098 shows a different amount than what I calculated?
The 1098 reflects what your lender actually paid on your behalf, which may differ from what you think you paid. If you made extra payments, paid off the loan early, or had escrow adjustments, the 1098 amount might not match your own records. Contact your lender to understand the difference before reporting it on your tax return.
Do I get a 1098 if I have a home equity line of credit?
A home equity line of credit (HELOC) may generate a 1098 if the interest paid exceeds $600 during the year, but the rules are different from a primary mortgage. The interest must be used for home improvements to be deductible. Consult your lender or a tax professional about whether your HELOC interest qualifies.