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1098 Forms Uncategorized

Form 1098-E Instructions: Reporting Student Loan Interest the Right Way

Updated: June 15, 2026

1098-E filing requirements include the correct application of the $600 threshold by the lender or servicer, aggregating interest at the borrower level, and reporting the right amount in Box 1. However, student loan interest reporting can become complicated when one borrower has multiple loans or when Box 1 includes loan origination fees or capitalized interest.

This guide explains the key Form 1098-E instructions for lenders, servicers, and other filers, with tips to help reduce common reporting errors.

What Form 1098-E Is and Why It Matters

Form 1098-E is the IRS information return used to report student loan interest received from an individual during the calendar year in the course of a trade or business.

It helps borrowers support their tax reporting and gives the IRS a matching record for student loan interest claimed on a return. A filer generally issues the form when reportable interest received from a borrower reaches $600 or more for the year.

This form commonly applies to banks, credit unions, student loan servicers, governmental units and agencies, educational institutions, and other holders of qualified student loans. The filing threshold is tied to the borrower, and not separately to each loan.

Who Must File Form 1098-E?

A filer generally must file Form 1098-E when they receive $600 or more in student loan interest from a borrower during the year as part of a trade or business. This rule can apply to lenders, schools, government agencies, and anyone else who receives student loan interest in a trade or business.

The rule works like this:

  • One borrower with one loan and $600 or more in reportable student loan interest: file Form 1098-E.
  • One borrower with multiple loans and $600 or more in total reportable student loan interest received from that borrower: file Form 1098-E.
  • For a borrower with less than $600 in total reportable student loan interest for the year, generally, no Form 1098-E is required.

A filer may issue one Form 1098-E covering all of a borrower’s student loans or separate forms if needed. When multiple parties are involved with the same loan, the party that receives the interest first is generally responsible for filing Form 1098-E.

Note: If a filer has multiple accounts for the same borrower and files more than one Form 1098-E for that borrower, the account number field is required. This helps the filer and IRS distinguish the forms for recordkeeping and corrections.

Form 1098-E Instructions: Box-by-Box Guide

Form 1098-E field What to enter or check
Filer and borrower information Enter the filer’s name, address, TIN, and phone number. Also, enter the borrower’s name, address, and TIN. The borrower’s TIN may be truncated on the borrower copy, but not on the copy filed with the IRS.
Account number Use this field when the filer has multiple loan accounts for the same borrower or files more than one Form 1098-E for that borrower. The IRS requires it in that situation and also encourages using it for clearer records.
Box 1: Total student loan interest received Report the full amount of student loan interest received for the year. If the loan was made after August 31, 2004, Box 1 must also include capitalized interest and eligible loan origination fees.
Box 2: Loan origination fees and capitalized interest not included in Box 1 For loans made before September 1, 2004, Box 2 is checked when the amount in Box 1 excludes loan origination fees or capitalized interest that may still be deductible.

Form 1098-E is a short form, but accuracy is still important. Before filing, check Box 1 against the filer’s student loan interest records and review the borrower’s name, address, and TIN to help avoid corrections and IRS mismatches.

How To Prepare Form 1098-E Correctly

Step 1: Collect borrower tax information

Enter the borrower’s legal name, address, and TIN. Form W-9S can be used to collect the borrower’s name, address, TIN, and student loan certification. Filers may also use their own substitute form or electronic collection process, as long as it meets IRS requirements. Year-end interest totals are not enough for an accurate Form 1098-E filing if the borrower’s name, address, or TIN is missing or incorrect.

Step 2: Add up reportable interest

Add up the student loan interest received from each borrower across all of that borrower’s student loans. The $600 filing threshold applies to the borrower’s total interest, not to each separate loan.

Step 3: Review Box 1 treatment

Before completing Box 1, review the loan date and type of interest received. Check whether the loan date requires capitalized interest or loan origination fees to be included in Box 1. For loans made before September 1, 2004, check Box 2 when Box 1 leaves out loan origination fees or capitalized interest.

Step 4: Provide the student loan interest statement

Give Copy B or a valid substitute statement to the borrower by the due date which is February 1, 2027. It can be sent electronically if the borrower consents to e-delivery and the electronic delivery rules set by the IRS are followed.

Step 5: File the return with the IRS

Before filing with the IRS (whether on paper or eFiling), it’s important to confirm whether the 10-or-more total information return rule requires eFiling.

Note on Form 1098-E due dates: The standard IRS due dates are January 31 to the borrower, February 28 to the IRS on paper, and March 31 if filed electronically. In 2027, January 31 and February 28 fall on Sundays, so they roll to the next business day and are as follows:

Filing step 2027 due date
Furnish borrower statement February 1, 2027
File with IRS by paper March 1, 2027
File with IRS electronically March 31, 2027

Common Form 1098-E Mistakes and Compliance Risks

Common filing problems include applying the $600 threshold incorrectly, reporting the wrong amount in Box 1, and confusing Form 1098-E with other education-related forms.

Such mistakes can be reduced by checking each borrower’s interest total, loan dates, and identifying information before preparing the forms.

Common mistake Risk How to avoid it
Applying the $600 threshold by loan instead of by borrower Required forms may be missed when a borrower has multiple loans. Add up reportable interest across all applicable accounts before filing.
Underreporting Box 1 Borrower statements may leave out capitalized interest or qualifying loan origination fees. Review the loan origination date and check whether capitalized interest or loan origination fees must be included before finalizing Box 1.
Confusing Form 1098-E with Form 1098-T The wrong education-related form may be issued. Use Form 1098-E for student loan interest received and Form 1098-T for tuition reporting.
Ignoring the 10-return aggregate eFile rule A filer may paper-file when electronic filing is required. Count all covered information returns before choosing the filing method.
Weak borrower TIN collection controls Corrections and IRS notices become more likely. Use Form W-9S or another intake process that meets IRS requirements before filing season.

Real-Life 1098-E Filing Scenarios

Scenario What to report
Borrower pays $740 in student loan interest across two loans held by the same filer File Form 1098-E and report $740 in Box 1.
Borrower pays $525 total student loan interest for the year No Form 1098-E is required because the total is below $600.
A post-2004 loan includes reportable capitalized interest Include the capitalized interest in the Box 1 amount.
Loan was made before September 1, 2004, and certain fees or capitalized interest are not included in Box 1 Check Box 2 to show that Box 1 does not include loan origination fees or capitalized interest that may be deductible.
Filer has 11 total information returns across different form types File electronically because the 10-return aggregate threshold is met.

FAQs

1. What are 1098-E instructions?

They are the filing rules for Form 1098-E. They explain who has to file the form, what amount should be reported, and how the statement should be given to the borrower and filed with the IRS.

2. What goes in Box 1 on Form 1098-E?

Box 1 shows the total reportable student loan interest received for the year. If the loan was made on or after September 1, 2004, Box 1 should include eligible loan origination fees and capitalized interest received for that year.

3. Can one borrower receive one Form 1098-E for multiple loans?

Yes. A filer can combine a borrower’s qualifying student loan interest on one Form 1098-E. Separate forms may also be used when needed for account tracking or internal recordkeeping.

4. What is the Form 1098-E due date?

For 2026 returns filed in 2027, the borrower copy is generally due by February 1, 2027. Paper filing with the IRS is generally due by March 1, 2027, and electronic filing is generally due by March 31, 2027.

5. Is Form 1098-E required to be eFiled?

Yes. Form 1098-E must generally be filed electronically if the filer has 10 or more total information returns for the year. The threshold is based on the filer’s aggregate information returns, not just Forms 1098-E.

Report student loan interest correctly with fewer Box 1 and threshold errors.
Start your Form 1098-E filing today