Form 1098: Home Mortgage Interest Statement
Form 1098 is an official IRS document used by mortgage lenders to report the amount of mortgage interest you paid during a tax year. You'll typically receive this form by January 31st of the following year. It serves as a reliable record for you and the IRS to ensure accurate tax calculations.
Who Receives a 1098?
Lenders are required to send a 1098 if:
- You paid at least $600 in mortgage interest during the year.
- Your property qualifies as real property according to IRS standards (typically a single-family home or condo).
Some additional points to consider:
- Even if you don't receive a 1098, you might still be eligible for a mortgage interest deduction. Keep good records of your mortgage payments for tax filing purposes.
- You may receive multiple Form 1098s if you have mortgages with different lenders.
- If you sell your home during the year, you might receive two Form 1098s – one from your original lender and one from the new owner's lender (if they closed on a mortgage before the end of the year).
What is the Purpose of a 1098?
The primary purpose of a 1098 is to provide you with accurate documentation of your mortgage interest payments for tax filing. When you itemize deductions on your tax return, this form helps you easily claim the mortgage interest deduction, which can significantly reduce your taxable income.
What if I don't receive a Form 1098?
If you paid $600 or more in mortgage interest and haven't received a 1098 by the end of January, contact your lender directly. There might be a delay or an error in processing. Alternatively, you can access your online account or contact your lender for a copy.
Can I deduct mortgage interest even if I don't receive a Form 1098?
Yes, you can still claim the deduction as long as you have documented proof of your interest payments. Gather your mortgage statements or payment records to substantiate the amount.
Can I deduct points paid on my mortgage using Form 1098?
Points, also known as loan origination fees, are typically prepaid interest paid at closing. While points can be deductible, they aren't reported on the 1098. You'll need to consult your loan documents or contact your lender to determine the amount of points paid and how to claim the deduction on your tax return.