A 1098 form reports mortgage interest you paid during the year to you and the IRS
A 1098 form is a tax document your mortgage lender sends you each January. It lists the total mortgage interest you paid in the previous year, along with property taxes your lender paid on your behalf if you have an escrow account. The form goes to both you and the Internal Revenue Service so your tax records match the lender's records.
You receive a 1098 if you have a mortgage loan on a home and paid at least $600 in mortgage interest during the year. If you paid less than that, your lender may still send one, but they are not required to. The form arrives by January 31st each year for the prior calendar year.
The 1098 is one of several mortgage-related documents you might receive. It is different from a 1099 form (which reports other types of income) and different from a Closing Disclosure (which you got when you took out the loan). The 1098 is purely about what you paid in interest and taxes during a specific year.
Key Takeaways
- Your lender sends a 1098 form by January 31st each year, reporting the mortgage interest and property taxes you paid in the previous year.
- You receive a 1098 only if you paid at least $600 in mortgage interest during the year, though some lenders send them for smaller amounts.
- The form shows up on your tax return because mortgage interest is often deductible if you itemize deductions instead of taking the standard deduction.
- You need the 1098 to file your taxes accurately, and the IRS receives a copy so they can verify your reported interest matches the lender's records.
Where the numbers on your 1098 come from
Your lender calculates the 1098 amounts from your loan payment history throughout the year. Each month when you make a mortgage payment, part of it goes toward interest and part toward the principal (the amount you borrowed). The lender adds up all the interest portions from January through December and reports that total in Box 1 of the 1098.
If you have an escrow account, your lender also collects money each month for property taxes and homeowners insurance. When the lender pays those bills on your behalf, they report the property taxes paid in Box 2 of the 1098. Insurance does not appear on the form because it is not tax-deductible.
Early in the loan, most of your payment goes toward interest. Later in the loan, more goes toward principal. This is why the interest amount on your 1098 decreases over time if you keep the same loan. If you paid off the loan partway through the year or refinanced, your 1098 will show only the interest paid before that event.
How the 1098 connects to your tax return
The mortgage interest reported on your 1098 may reduce the federal income tax you owe, but only if you itemize deductions on your tax return. Many people take the standard deduction instead, which means they do not report mortgage interest separately. Whether itemizing makes sense depends on your total deductions and your income level.
If you do itemize, you report the mortgage interest from Box 1 of your 1098 on Schedule A (Itemized Deductions) of your tax return. The IRS compares this number to the copy of the 1098 your lender sent them. If the numbers do not match, the IRS may contact you to ask why.
Property taxes from Box 2 of the 1098 also go on Schedule A if you itemize. However, there is a limit on how much in state and local taxes (SALT) you can deduct each year. This limit has changed in recent years, so check the current rules or ask a tax professional about your situation.
What to do if you do not receive your 1098
If January 31st has passed and you have not received your 1098, contact your lender's customer service or loan servicing department. They can tell you whether the form was mailed to the address on file or if there was a delay. Ask them to send a replacement copy or provide the information over the phone so you can note it.
If your lender says they sent it but you never got it, ask them to mail another one or provide it electronically. Some lenders offer online access to tax documents through their website or mobile app. You may also be able to read a copy from your loan account.
Do not file your tax return without the 1098 if you are itemizing deductions and claiming mortgage interest. The IRS has your lender's copy, and filing without matching numbers can trigger a notice. If you absolutely cannot get the form in time, you can file for an extension, but it is better to wait for the document or get the numbers from your lender directly.
Different types of 1098 forms for different loans
The standard 1098 form reports mortgage interest on a primary or secondary home loan. A 1098-T is different — it reports student loan interest, not mortgage interest. A 1098-Q reports interest on a PLUS loan (a federal student loan for parents or graduate students). These forms serve the same purpose as a mortgage 1098 but for different types of debt.
If you have a home equity line of credit (HELOC) or a home equity loan, your lender may send a 1098 for that as well. The interest on a HELOC or home equity loan may be deductible under certain conditions, though the rules changed after 2017. Check the instructions that come with your 1098 or consult a tax professional about whether your specific loan qualifies.
If you refinanced your mortgage during the year, you may receive two 1098 forms — one from your old lender for the interest paid before the refinance, and one from your new lender for the interest paid after. Both are correct, and you report the interest from both on your tax return.
Keeping your 1098 for your records
Keep your 1098 with your tax return and supporting documents for at least three years. The IRS can audit your return up to three years back in most cases, and you may need to show the 1098 to prove the interest amount you reported. If the IRS questions your deduction, the 1098 is your proof that the lender reported the same number.
If you file electronically, you do not need to mail the 1098 to the IRS — your tax software or tax professional will reference the information, and the IRS already has their copy from the lender. However, you should still keep a copy for your own records in case questions come up later.
Some people save their 1098 forms for many years, especially if they are tracking the total interest paid over the life of the loan. This can be useful information if you are considering refinancing or paying off the loan early, since it shows you how much interest you have already paid.
Frequently Asked Questions
What if the 1098 amount does not match what I calculated?
Your lender's calculation is the official number. If you think there is an error, contact your lender and ask them to review the payment history for the year. Errors do happen — a payment might have been misapplied, or an escrow adjustment might have affected the total. Your lender can issue a corrected 1098 if needed.
Can I deduct mortgage interest if I do not itemize?
No. Mortgage interest is only deductible if you itemize deductions on Schedule A of your tax return. If you take the standard deduction, you cannot report mortgage interest separately. Many people find the standard deduction is larger than their itemized deductions, so they use that instead.
Do I need a 1098 to pay my mortgage?
No. The 1098 is only for tax purposes. You do not need it to make your monthly mortgage payment or to manage your loan. Your lender sends it because the IRS requires them to report the interest you paid, not because you need it to stay current on your loan.
What if I paid off my mortgage during the year?
Your lender will send a 1098 showing only the interest paid before you paid off the loan. The form will show the payoff date or note that the loan was satisfied. You report only the interest paid during the months you had the loan, not a full year's worth.
Is the 1098 the same as a mortgage statement?
No. Your monthly mortgage statement shows what you paid that month and your remaining balance. The 1098 is an annual summary sent only once per year for tax purposes. You need both documents for different reasons — the statement to track your loan, the 1098 to file your taxes.