A Form 1098 mortgage interest statement shows the interest a lender received from the borrower during the year, plus the outstanding principal, the origination date, points paid on a home purchase, any refund of overpaid interest and the property address. A preparer takes the interest and points figures, checks the property, and compares any escrowed tax to the county bill.
Boxes on the 1098 mortgage interest statement
The 1098 mortgage interest statement has eleven numbered boxes, and the IRS Instructions for Form 1098 (Rev. December 2026) define each one. Lenders file it for each mortgage on which they received $600 or more of interest from an individual during the year. The payer of record, the borrower carried as principal on the lender's books, gets the statement.
The boxes a preparer reads most are these:
- Box 1, Mortgage Interest Received From Payer(s)/Borrower(s): interest received during the calendar year, not including points.
- Box 2, Outstanding Mortgage Principal: the balance as of January 1, or as of the origination or acquisition date if that was during the year.
- Box 3, Mortgage Origination Date: the date the loan originated with the original lender.
- Box 4, Refund of Overpaid Interest: a refund or credit of interest overpaid in a prior year.
- Box 5, Mortgage Insurance Premiums: premiums of $600 or more received for the year.
- Box 6, Points Paid on Purchase of Principal Residence.
- Boxes 7 and 8: a checkbox the lender may use when the property address matches the borrower's mailing address, and the address or description of the property, which is required when box 7 is not checked.
- Box 9, Number of Mortgaged Properties: filled in when more than one property secures the loan.
- Box 10, Other: optional items such as real estate taxes or insurance paid from escrow.
- Box 11, Mortgage Acquisition Date: filled in only if the current holder acquired the loan during the year.
Checklist: 1098 fields to capture and where they go
The Schedule A line numbers below come from the IRS Instructions for Schedule A (2025). Check the current year's instructions before using them. The example values belong to a fictional client.
| Field | Example value | Where it goes |
|---|---|---|
| Box 1 interest | $11,842.17 | Line 8a, mortgage interest and points reported on Form 1098 |
| Box 6 points | $2,950.00 | Line 8a, with the box 1 interest |
| Box 2 principal and box 3 date | $384,000.00, 06/14/2023 | Not entered; used when the home mortgage interest limits apply |
| Box 4 refund | $212.40 | Does not reduce line 8a; the instructions point to Schedule 1, line 8z |
| Box 5 premiums | $1,104.00 | Line 8d was reserved for 2025; check the current year |
| Box 8 address | 41 Example Lane | Confirms which property the loan secures |
| Box 10 taxes | $6,318.00 | Compare to the county bill before line 5b |
| Payer and account | Example Mortgage Servicing, XXXX-4821 | Matches the form to last year's 1098 |
Do points and refunded interest on a 1098 change the deduction?
Points and refunded interest on a 1098 each have their own rule. Points in box 6 are reported with the box 1 interest on line 8a, according to the Schedule A instructions. A refund of overpaid interest in box 4 does not reduce that deduction; the instructions send the refund to Schedule 1 instead.
Points on a refinance usually do not appear in box 6, because box 6 covers points paid on the purchase of a principal residence. IRS Publication 936 (2025) says points paid to refinance "aren't deductible in full in the year you pay them" and are generally spread over the life of the loan. A refinance year with no box 6 amount is normal.
The box 4 refund matters only when the earlier interest was deducted. Publication 936 says a refund of interest deducted in an earlier year is generally included in income, up to the amount of the earlier deduction that reduced tax. Last year's return shows whether the client itemized.
Box 5 needs a check every year. Publication 936 (2025), for 2025 returns, says "The itemized deduction for mortgage insurance premiums has expired." The 1098 instructions tie box 5 reporting to whether that rule applies for the year, so read the current year's publication before treating the amount as deductible or not.
The property tax bill for the tax return versus the 1098 escrow box
The property tax bill for the tax return shows what the taxing authority charged. The 1098 escrow figure in box 10 shows what the lender chose to report, and box 10 is optional. The Schedule A instructions say only "the amount the mortgage company actually paid to the taxing authority" counts, not the amount paid into escrow.
The two numbers disagree for ordinary reasons. A lender may report escrow deposits instead of disbursements. A county may bill in installments that straddle the year. A loan sold mid-year can leave each servicer reporting only its share. A homeowner may have paid a supplemental bill directly. Any of these leaves box 10 and the county bill apart.
Ask the client for the county bill or the county's payment history alongside the 1098. In the checklist example, box 10 shows $6,318.00 while the example county bill shows two installments of $3,204.50, or $6,409.00. The $91.00 gap is a question to resolve with the escrow statement, not a number to pick.
What if a mortgage interest statement lists two borrowers or a refinanced loan?
A mortgage interest statement names only one payer of record, even when two people are on the loan. The IRS Instructions for Form 1098 say lenders prepare it "only for the payer of record." The co-borrower who is not named still may have paid interest, and the Schedule A instructions cover that share.
When shared interest is on the client's own 1098, the Schedule A instructions say to deduct only the client's share on line 8a. When it is on someone else's 1098, the client's share goes on line 8b, with a statement identifying the other person on a paper return. Publication 936 says to show how much of the interest each person paid.
A refinance usually means more than one 1098. A refinance is a new loan, and box 1 on each statement covers the interest that lender received during the calendar year, so the old loan and the new one can each produce a statement. Box 3 shows when the new loan originated, and box 11 shows a date when a holder acquired a loan during the year. Expect one statement per loan per holder, and ask the client when a known lender is missing.
The 1098 is easy to forget when a client changes lenders, and the list of documents clients forget to send covers the late arrivals. For forms that are hard to read by machine, see which tax forms trip up OCR most.
The same folder often holds a client's wage records too; pay stub OCR and turning stubs into one spreadsheet cover those. Schema CPA reads 1098s with the rest of the client's tax forms and flags a lender that sent a statement last year but not this year. The client tracker demo shows that check.