A 1098 is a tax form your lender sends you each year showing how much mortgage interest and property taxes you paid

The 1098 form (officially called the Mortgage Interest Statement) is a document your mortgage lender mails to you and the IRS every January. It lists the total mortgage interest you paid during the previous year, along with property taxes your lender paid on your behalf if they held them in escrow. You use this form to claim the mortgage interest deduction on your federal tax return — one of the largest deductions available to homeowners.

The form comes in several versions depending on your loan type. The most common is the 1098, used for standard mortgages. If you have a home equity line of credit (HELOC) or home equity loan, you may receive a 1098-H instead. If you paid mortgage insurance premiums, those appear on the 1098 as well. The lender is required by law to send you this form if you paid $600 or more in mortgage interest during the year.

You do not need to send the 1098 to the IRS — your lender does that automatically. But you do need to keep it with your tax records and reference the numbers when you file your return, whether you file on paper or electronically.

Key Takeaways

  • A 1098 shows your mortgage interest paid and property taxes paid in escrow during the year, sent by your lender in January.
  • You use the mortgage interest amount to claim a deduction on your federal tax return if you itemize deductions.
  • The lender sends the form to both you and the IRS, so the IRS already has a record of the numbers you report.
  • You must receive a 1098 if you paid $600 or more in mortgage interest; some lenders send it anyway for smaller amounts.
  • Mortgage insurance premiums (PMI) are also listed on the 1098 and may be deductible depending on your income.

Where the numbers on your 1098 come from

Your lender calculates the 1098 from your monthly mortgage payments throughout the year. Each month, part of your payment goes toward interest and part toward principal. The lender adds up all the interest portions and reports that total on Box 1 of the form. If your lender collects property taxes through an escrow account (a separate account they hold your money in), they report those taxes paid on Box 2.

The numbers are not estimates — they come directly from your loan account records. If you made extra payments toward principal, those do not change the interest calculation; the lender reports only the interest actually paid. If you paid off your mortgage early in the year, the form reflects only the interest paid through the payoff date.

Some lenders also report mortgage insurance premiums (PMI) in Box 4. This is the insurance you pay if you put down less than 20 percent on your home. The amount varies by loan balance and your credit profile at the time you took out the loan.

How to use the 1098 when filing taxes

To use your 1098, you must itemize deductions on your tax return rather than take the standard deduction. The standard deduction is a flat amount the IRS allows everyone; itemizing means you add up your deductible expenses (mortgage interest, property taxes, charitable donations, and others) and deduct that total instead. You choose whichever method gives you the larger deduction.

If you itemize, you report the mortgage interest from Box 1 of your 1098 on Schedule A (Itemized Deductions), which you attach to your Form 1040. You can also deduct state and local property taxes up to $10,000 per year, which may come from Box 2 of your 1098 or from your property tax bill directly. Mortgage insurance premiums from Box 4 can be deducted as well, though this deduction phases out at higher income levels and is not available to all taxpayers.

If the numbers on your 1098 do not match what you calculated from your monthly statements, contact your lender to ask for a corrected form (called a 1098-C). This sometimes happens if you made a large extra payment late in the year or if the lender made an error. Request the correction before you file your return.

When you might not receive a 1098

You will not receive a 1098 if you paid less than $600 in mortgage interest during the year. This can happen if you took out a mortgage late in the year, paid off the loan early, or have a very small loan balance. Some lenders send the form anyway even for amounts under $600, but they are not required to.

If you do not receive a 1098 by early February, contact your lender directly. They may have an incorrect mailing address on file, or the form may have been lost in the mail. You can request a copy by phone or through your online account. If you need to file your return before the form arrives, you can estimate the interest from your monthly statements and file; you can amend your return later if the numbers differ.

Renters do not receive a 1098 because they do not pay mortgage interest. Homeowners who pay their property taxes directly (not through escrow) will still receive a 1098 for mortgage interest, but the property tax box will be blank.

The difference between a 1098 and other mortgage-related forms

The 1098 is sometimes confused with other documents lenders send. A Loan Estimate or Closing Disclosure shows what you will pay over the life of the loan; these are sent at the beginning of the mortgage process, not for tax purposes. A 1099-S is sent if you sell your home and the sale involves a financial institution; it reports the sale price, not your interest paid.

The 1098-T is completely different — it covers education expenses, not mortgage interest. The 1098-H covers home equity loans and HELOCs. If you have multiple mortgages on the same property, you will receive a separate 1098 from each lender, and you must report the interest from all of them on your tax return.

What happens if your 1098 is lost or arrives late

If your 1098 does not arrive by early February, you have options. First, check your lender's online portal or call their customer service line to see if they can email or mail a duplicate. Many lenders can generate a copy within a few business days. If the original was lost in the mail, the lender can issue a replacement.

If you cannot reach your lender or they cannot provide the form in time, you can reconstruct the information from your monthly mortgage statements. Add up the interest portion of each payment for the year, and use that total on your tax return. Keep your statements with your tax records in case the IRS asks questions later.

If you file your return before receiving the 1098 and the numbers turn out to be different, you can file an amended return (Form 1040-X) once you have the correct form. The IRS will not penalize you for filing with estimated numbers if you file the amendment within the normal time frame.

Frequently Asked Questions

Do I have to send my 1098 to the IRS?

No. Your lender sends the 1098 to the IRS automatically. You keep your copy for your records and reference the numbers when you file your return, but you do not mail the form itself to the IRS.

Can I deduct mortgage interest if I do not itemize?

No. The mortgage interest deduction is only available if you itemize deductions on Schedule A. If you take the standard deduction instead, you cannot claim mortgage interest separately. Many homeowners find that itemizing gives them a larger deduction, especially if they also have significant property taxes or charitable donations.

What if my 1098 shows interest I did not actually pay?

Contact your lender when ready. The form should match your monthly statements exactly. If there is a discrepancy, the lender may have made an error or applied a payment incorrectly. Ask for a corrected 1098-C before you file your return.

Does PMI on my 1098 mean I can deduct it?

Mortgage insurance premiums shown on Box 4 may be deductible, but not for all taxpayers. The deduction phases out if your modified adjusted gross income exceeds certain thresholds, which vary by year. Check the IRS instructions for Form 1040 or consult a tax professional to see if you may have access to.

What if I paid off my mortgage during the year?

Your 1098 will show only the interest paid through the payoff date. For example, if you paid off the loan in June, the form reflects interest paid January through June. You report that amount on your tax return for that year.