What is a 1098?

Every January, homeowners across the country receive notice from their mortgage servicer that their 1098 tax form will be available soon.

And, every January, innumerable homeowners look at the notice and say, “That’s great — what’s a 1098?”

A 1098 form, officially called the Mortgage Interest Statement, is a tax document your mortgage servicer sends you once a year — typically by the end of January. Servicers are required to provide it by January 31, so most homeowners receive it sometime in the last week of January or even a little earlier if they’ve opted for electronic delivery.

The purpose of the 1098 is simple: it tells you exactly how much mortgage interest you paid during the previous year. This number matters because, depending on your situation, you may be able to use it to reduce your taxable income. In other words, it might help you save money at tax time.

Think of the 1098 as a receipt for the interest portion of your mortgage payments. The form may also list other items, like mortgage insurance premiums or points you may have paid when you got your loan. You don’t have to calculate anything on your own — your servicer already did the math.

The most important thing to remember: When your 1098 arrives — whether by email, your online account or mail — put it somewhere safe so it will be handy come tax time.

For educational purposes only.