Mortgage interest is reported on IRS Form 1098 when you pay $600 or more during the year and is used to claim deductions on Schedule A (Form 1040).
What’s Happening with Your 1098 Form
Form 1098 is the IRS document that lenders use to report mortgage interest paid over $600 to both you and the government and must be sent by January 31 each year.
This form matters because it tells the IRS about your mortgage interest deduction claims. Lenders only have to issue it when you’ve paid $600 or more in mortgage interest, points, or mortgage insurance premiums during the tax year, according to the IRS. If you paid less than that, they don’t have to send it—but you can still deduct the interest if you’re itemizing on Schedule A (Form 1040). The IRS Schedule A instructions make it clear you may still claim the deduction without a 1098 if you have records. Honestly, this is the best way to handle smaller mortgage interest payments.
Step-by-Step Solution
To use your mortgage interest for tax deductions, follow these steps: confirm eligibility, locate your Form 1098, transfer the interest amount to Schedule A, and meet the January 31 deadline.
- Confirm You Need Form 1098
- Lenders only issue Form 1098 if you paid $600 or more in mortgage interest, points, or mortgage insurance during the year, per IRS guidelines.
- If you paid less than $600, you can still deduct the interest by manually adding it to line 11 of Schedule A.
- Locate Your Form 1098
- Most lenders post the form under “Tax Documents” in your online account after mid-January.
- If you don’t see it online, call customer service—some lenders charge for replacements, while others provide it for free.
- Make sure your mailing address is updated with your lender to avoid delays.
- Use the Form for Your Tax Return
- Copy the mortgage interest from Box 1 of Form 1098 to line 10 of Schedule A (Form 1040).
- If you didn’t receive the form but paid $600+, enter the total interest on line 11 of Schedule A and keep payment records.
- One caveat: mortgage interest only helps if you itemize deductions instead of taking the standard deduction.
- Check Deadlines
- Lenders must mail or deliver Form 1098 by January 31 each year.
- You don’t file the form itself—just transfer the interest amount to your tax return.
If You Can’t Find Your Form 1098
If you can’t find Form 1098, contact your lender for a duplicate, manually calculate the interest paid, or consult a tax professional for guidance.
- Contact the Lender Again
- Send a secure message or email through the lender’s portal requesting a duplicate Form 1098.
- Ask if your lender reports interest to the IRS—some small lenders or private loans may not issue the form at all.
- Calculate Interest Manually
- Review monthly statements or year-end summaries to total the interest paid.
- Report the total on line 11 of Schedule A (Form 1040) if no Form 1098 is available.
- Keep bank records or payment confirmations handy in case the IRS asks for proof.
- Consult a Tax Professional
- If you’re unsure whether your loan qualifies for interest deductions, a CPA or tax advisor can clarify eligibility.
- They can also check if deductions apply to loans like home-equity lines of credit or second mortgages.
How to Avoid Problems Next Year
To avoid issues next tax season, update your lender’s contact information, track mortgage interest payments annually, and understand deduction limits.
- Update Your Contact Info
- Before year-end, double-check your mailing address and email with your lender.
- Opt into electronic delivery so Form 1098 shows up online right away.
- Track Your Payments
- Keep a folder—digital or paper—of monthly mortgage statements and year-end summaries.
- Jot down the total interest paid each year, especially after refinancing or switching lenders.
- Know the Threshold
- Lenders don’t have to issue Form 1098 for interest under $600, so track it yourself.
- Remember that mortgage interest deductions only work if you itemize deductions on Schedule A.
- Understand Deduction Limits
- As of 2026, you can deduct interest on mortgages up to $750,000 in principal (or $1 million if the loan originated before December 15, 2017), per IRS rules.
- Interest on home-equity loans used for anything other than home improvements isn’t deductible, as clarified by the Consumer Financial Protection Bureau.
What About Private or Small Lender Loans?
Private or small lender loans may not issue Form 1098, so you’ll need to track interest yourself and report it manually on Schedule A.
These lenders often fly under the IRS radar, so they don’t always send Form 1098. That doesn’t mean you lose the deduction—just keep your monthly statements and payment records. When you file, add the total interest to line 11 of Schedule A. The IRS accepts this as long as you have proof. (Pro tip: Screenshot your online payment history if you don’t get paper statements.)
Can You Deduct All Your Mortgage Interest?
You can only deduct mortgage interest if you itemize deductions on Schedule A, and the loan must meet IRS requirements.
This isn’t a free-for-all deduction. The loan must be secured by your home, and the interest must be for the mortgage itself—not extra fees or penalties. Also, the IRS caps the deduction based on your loan amount. For loans after December 15, 2017, you’re limited to $750,000 in principal. Older loans get a $1 million cap. Any interest beyond those limits? Not deductible. Honestly, this is the most frustrating part of mortgage deductions—so many people assume they can deduct everything, but the rules are stricter than you’d think.
What If You Refinanced This Year?
If you refinanced, you’ll get multiple Form 1098s—one from each lender—and need to combine the interest amounts for your deduction.
Refinancing splits your mortgage history into two loans in the IRS’s eyes. Each lender will send its own Form 1098 for the interest you paid under that loan. Grab both forms, add up the interest from Box 1, and report the total on line 10 of Schedule A. Don’t forget to check the dates—you only deduct interest for the time you actually paid each loan. (This is where a spreadsheet comes in handy.)
Do You Need Form 1098 to Claim the Deduction?
You don’t always need Form 1098 to claim the deduction—just solid records if you paid $600 or more.
Here’s the thing: the IRS doesn’t require Form 1098 for the deduction itself. What they want is proof you actually paid the interest. So if your lender didn’t send one (or you lost it), pull out your bank statements or monthly mortgage statements. Add up the interest paid for the year, then report it on line 11 of Schedule A. Just make sure you can back it up if the IRS asks. (Avoid the “my dog ate my statements” excuse—it never works.)
What’s the Deadline for Form 1098?
Lenders must send Form 1098 by January 31 each year, but you don’t file the form itself—just use the numbers on your tax return.
That January 31 deadline is strict for lenders, but it doesn’t affect when you file your taxes. You have until April 15 (usually) to submit your return. The form’s just a way to confirm the interest you paid—you’ll transfer the number to your Schedule A anyway. If your lender misses the deadline, don’t panic. Call them and ask for a copy, or use your own records. The IRS won’t penalize you for a late form as long as you report the correct amount.
Can You Claim Points Paid at Closing?
Yes, you can deduct points paid at closing—but they must be spread over the life of the loan, not all at once.
Points are those extra fees you pay to get a lower interest rate. The IRS lets you deduct them, but not in one lump sum. Instead, you spread the cost over the loan’s term. So if you paid $3,000 in points on a 30-year mortgage, you’d deduct $100 per year. The good news? You can deduct the full amount if you sell the house or refinance. Just make sure the points meet IRS rules—they have to be for mortgage interest, not service fees. (And yes, this is one of those deductions people often miss.)
What If You Sold Your Home This Year?
If you sold your home, you’ll still get a Form 1098 for the interest paid up to the sale date, and you may deduct prepaid points.
Selling a home splits the mortgage history, just like refinancing. Your lender will send a Form 1098 for the interest you paid before the sale. Report that amount on Schedule A as usual. But here’s a bonus: if you prepaid points at closing, you can deduct the remaining balance in the year you sell. So if you had 20 years of points left but sold after 5, you’d deduct the remaining 15 years’ worth. (This is one of those rare tax breaks that actually rewards you for moving.)
Do You Need to Report Form 1098 to the IRS?
No, you don’t send Form 1098 to the IRS—just report the interest amount on your Schedule A.
Here’s where people get confused. Form 1098 is for your records and your lender’s records. The IRS already gets a copy from your lender, so you don’t need to attach it to your return. Just use the number from Box 1 and transfer it to line 10 of Schedule A. If the numbers don’t match what the IRS has, they’ll send you a letter—but that’s rare. Most of the time, it’s a smooth process. (Still, double-check the numbers to be safe.)
What If Your Lender Made a Mistake on Form 1098?
If your lender made a mistake on Form 1098, contact them immediately to issue a corrected form.
Mistakes happen—maybe they reported the wrong amount or included fees that shouldn’t be there. Don’t just assume the number is correct. Call your lender and ask for a corrected Form 1098. They’ll send an updated version to both you and the IRS. If you’ve already filed your taxes, you may need to amend your return. The IRS allows corrections, but you’ll need the updated form to do it. (Pro tip: Check your Form 1098 against your year-end mortgage statement to catch errors early.)
Can You Deduct Mortgage Insurance Premiums?
You can deduct mortgage insurance premiums if they were paid in 2023 or earlier, but this deduction expired after 2023.
This one’s a bit of a moving target. For 2023 and prior years, you could deduct mortgage insurance premiums as home mortgage interest. But Congress didn’t renew this deduction for 2024, so it’s gone—at least for now. If you paid premiums in 2023, report them on line 8d of Schedule A. For 2024, you’re out of luck unless Congress brings it back. (Honestly, this is one of those deductions that keeps disappearing and reappearing—so frustrating for homeowners.)
What’s the Difference Between Form 1098 and Form 1098-E?
Form 1098 reports mortgage interest, while Form 1098-E reports student loan interest paid over $600.
They look similar, but they’re for totally different things. Form 1098 is all about your mortgage, while Form 1098-E is for student loans. Both have the same $600 threshold, but that’s where the similarities end. If you paid both mortgage interest and student loans, you’ll get two separate forms. Easy to mix up, but the IRS treats them very differently. (So don’t accidentally deduct your student loan interest on Schedule A—that won’t fly.)
