What Is Form 1098?

Interest from mortgage, qualified student loans, tuition statement, and donating vehicles to charities are all considered reportable transactions by the IRS. Which means, if an organization has made payments related to these transactions, they will have to file form 1098 or its variants.

So, let’s take a detailed look at what is form 1098 and all its variants.

What Is Form 1098 and It’s Variants

Mortgage lenders, financial institutions, charities, educational institutions. These are some of the entities that need to report interest payments to the IRS using Form 1098 and its variants.

Reporting interest payments not only helps the IRS track payments but it also helps taxpayers claim deductible expenses on their tax returns.

Common Form 1098 Variants

Form 1098: Reports $600 or in mortgage interest paid on a secured real property loan.

Form 1098-E: Reports qualified student interest payments of $600 or more.

Form 1098-T: Reports qualified tuition and related expenses of a student (no minimum threshold)

Form 1098-C: Reports qualified motor vehicle donations with full market value (FMV) of over $500.

What is Reported on Each 1098 Form?

Form 1098: Mortgage Interest Reporting

Box 1: Mortgage Interest Received from Payer(s)/Borrower(s)

Report the mortgage interest amount from regular mortgages, home equity loans, and credit lines that are backed by real estate.

Box 2: Outstanding Mortgage Principal

Report the amount of outstanding principal on the mortgage as of January 1, of the current year.

Box 3: Mortgage Origination Date

Add the original date the mortgage started.

Box 4: Refund of Overpaid Interest

Report any interest refunds you gave back to the borrower for previous years.

Box 5: Mortgage Insurance Premiums

Report mortgage insurance premiums (MIP) if they’re $600 or more (only if the IRS requires it).

Box 6: Points Paid on Purchase of Principal Residence

Reports points (fees) paid upfront when someone buys their main home.

Box 7: Address of Property Securing Mortgage

Check this box if the property address is the same as the borrower’s mailing address.

Box 8: Address or Description of Property Securing Mortgage

Add the exact address if the property address is different.

Box 9: Number of Mortgaged Properties

Report the total number of mortgaged properties, if there are multiple properties tied to the loan.

Box 10: Other (Optional)

Add any extra info like escrow payments or collection agent name.

Box 11: Mortgage Acquisition Date

Include the date you acquired the mortgage (if acquired during the year).

Form 1098-E: Student Loan Interest Reporting

Box 1: Student Loan Interest Received by Lender

Report the total student loan interest received during the year, including certain fees and capitalized interest for loans made on or after September 1, 2004.

Box 2: Checkbox

Check this box for loans not reported on Box 1 and made before September 1, 2004.

Form 1098-T Tuition Statement Reporting

Box 1: Payments Received for Qualified Tuition and Related Expenses

Report the total qualified tuition and related expense payments received in 2025.

Box 4: Adjustments Made for a Prior Year

Report any refunds or billing reductions from the previous years.

Box 5: Scholarships or Grants

Report scholarships or grants, including funds from the government, nonprofits, and other third parties.

Box 6: Adjustments to Scholarships or Grants for a Prior Year

Report any reductions made in the previous year to scholarships or grants.

Box 7: Checkbox for Amounts for an Academic Period Beginning in January Through March of 2026

Check this box for payments made for classes starting between January and March of 2026.

Box 8: Check if at Least Half-Time Student

Check this box if student is a half-time student during any part of the year.

Box 9: Check if a Graduate Student

Check this box if student is enrolled in a graduate program.

Box 10: Insurance Contract Reimbursements or Refunds

Report any tuition reimbursements paid during the previous year (for insurance companies).

Form 1098-C: Vehicle Donation Reporting

Box 1: Date of Contribution

Report the date the donation was received.

Boxes 2a, b, c, & d: Odometer Mileage, Year, Make, and Model of Vehicle

Report basic info like mileage, year, make, and model.

Box 3: Vehicle or Other Identification Number

Report the vehicle ID number (VIN for cars, hull or aircraft ID for boats or planes).

Box 4a, b, & c: Vehicle Sold to Unrelated Party

Report date of sale and gross proceeds if the vehicle was sold in a normal sale to someone unrelated.

Box 5a, b, & c: Vehicle Transfer

Report if the charity plans to use the vehicle or improve it before transferring, or if they’re giving it to someone in need for free or cheap.

Box 6a, b, & c: Checkbox for Goods and Services

Report if the donor got anything in return, like goods or services, and their worth.

Box 7. Checkbox for a Vehicle with a Claimed Value of $500 or Less

Check this box if the vehicle was worth $500 or less.

Note:

If a donated vehicle has a value of more than $500, a contemporaneous written acknowledgment or CMV of the contribution must be furnished. Otherwise, the donor cannot claim a deduction.

Deadlines For 1098 Forms

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How to Fix Common Mistakes When Reporting Interest Payments

Mistake 1: Mortgage points are reported in Box 6 but sometimes it can be mistakenly reported in Box 1 of Form 1098. You can fix this mistake by issuing a CORRECTED Form with the updated details.

Mistake 2: If a registrar reports tuition payments on 1098-T using amounts billed and the bursar office uses amounts paid, it could lead to rejected filings due to mismatch in reported amount. Use only one method of reporting.

Mistake 3: A CWA has to be provided for every Form 1098-C Vehicle Donation filed. If it’s not provided, the recipient will not be able to claim any deductions. Send a CWA and file the form again to correct this mistake.
Mistake 4: Incorrect TIN and name combination on Form 1098 can lead to penalties. Use Tax1099’s TIN match to verify recipient TIN with IRS records. If the form was filed already, send a CORRECTED form with the updated TIN.

Real-life Reporting Scenarios: When Do You Use Form 1098 and Variants?

Reporting $3,200 Mortgage Interest

If a borrower or recipient has paid $3,200 in mortgage interest during a calendar year, the lender is required to file Form 1098 and provide a copy to the borrower (since amount is above the minimum 1098 reporting threshold). The borrower can use this to claim a deduction on Schedule A (Itemized Deductions).

Reporting $900 Student Loan Interest

If a borrower or student pays $900 in student loan interest, Form 1098-E can be filed since the reporting amount is more than the $600 threshold. The student can also deduct up to $2,500 on Schedule 1 of Form 1040.

Reporting $7,500 Tuition Statement

If $7,500 was paid by the student as tuition, the educational institution will report this amount on Form 1098-T (no minimum threshold). The student can then use Copy B of 1098-T to claim American Opportunity Credit.

Reporting Car Donation Worth $4,500

If someone donates a vehicle worth $4,500 to charity, the charity itself must file Form 1098-C to report the donation. The donor may then claim a deduction on their tax return.

Reporting $550 mortgage interest

If a borrower or recipient pays $550 for mortgage, there is no requirement to report this amount to the IRS since it doesn’t reach the minimum reporting threshold.

One missed deadline or one error, and the trust you’ve built with borrowers, students, or donors is at risk. Tax1099 is here to make sure the trust remains strong and automate your 1098 e-filing. Whether you’re e-filing form 1098 mortgage interest, 1098-E student loan interest, 1098-T tuition statement, or 1098-C vehicle donation, we always make sure your tax form filing is correct and accurate.

FAQs

Does the $600 rule apply to tuition payment reporting?

No, there is no minimum threshold for reporting tuition payments. Educational institutions must issue Form 1098-T for any amount paid or billed for tuition.

Can Copy B of form 1098 and variants be emailed?

Yes, if the recipient consents to electronic delivery under IRS Pub 1179, you can send Copy B of the 1098 forms to the recipient via Tax1099’s eDelivery portal.

If there are two lenders in a single year, who is responsible for filing 1098?

If there are two lenders, each lender must file a single 1098 or variant form for the exact months it held the loan. The recipient may receive multiple forms.

What is the penalty for missing the Form 1098 and variant filing deadline?

If you miss the filing deadline for 1098 and its variants, you will be subjected to the following penalties:

If there are multiple loans for the same borrower, can the lender apply for only one 1098 form or do they have to apply for all the loans?

If the recipient or borrower has multiple loans, the lender must file a separate Form 1098 for each loan account.

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