What is Form 1098?
Form 1098 is a form issued by the Internal Revenue Service (IRS). This form is primarily used to report mortgage interest of $600 or more received by you during the year in the course of your trade or business from an individual, including a sole proprietor.
Can I fill out Form 1098?
If you are a lender or recipient of mortgage interest of $600 or more, then you are eligible to fill out this form.
What do I need to fill out Form 1098?
To fill out Form 1098, you will be needing information related to you and your borrower.
Specifically, as the recipient of the interest, you will be asked to provide your full legal name, current street or residential address along with its corresponding city or town, state or province, country, ZIP or foreign postal code, and telephone number. You will also have to provide your TIN.
You will also be asked to provide similar information in relation to your borrower. You will have to write down his or her full legal name, current street or residential address, including the apartment number if applicable, and its corresponding city or town, state or province, country, ZIP or foreign postal code, and telephone number. You will also have to provide your borrower’s TIN.
You will also need information regarding the mortgage itself. You will be asked for the number of properties securing the mortgage and the corresponding account number. You must also know the mortgage interest received, outstanding mortgage principal, mortgage origination date, refunded amount of overpaid interest, mortgage insurance premiums, points paid on purchase of principal residence, address or description of property securing mortgage, and the mortgage acquisition date.
How do I fill out Form 1098?
We will be guiding you through the process of filling out Form 1098 by giving you a step-by-step tutorial on how to properly complete this form.
Before attempting to fill out this form, read through the instructions carefully to find out exactly what kind of information you would need to fill out each and every single box. For your convenience, we have written down everything that you may need to know for the purpose of filling out this form in the section entitled “What do I need to fill out Form 1098?”
Ensure that all information that you are about to write down is completely accurate and truthful. This is a document to be sent to the IRS, a department of the government, and thus should be treated with the utmost level of care and attention.
This form has three (3) different copies, one for you, the recipient, one for the payer of the interest, and one for the IRS. The information on all of the forms should be completely identical.
In this section of the form, you will have to provide information regarding yourself as the recipient of the mortgage payments, or the lender.
First, write down your full legal name. This consists of your first name, middle name, last name, and suffix if applicable. As there is no specified format, you may write these names down in any format you please.
Following this, in the same space, write down the details regarding your current street or residential address. This is the address in which you are currently residing in. The additional details that you must provide regarding your address include the city or town where this address can be located in, the corresponding state or province, country, and appropriate ZIP code or foreign postal code. You will also have to write down your telephone number for this address.
Finally, you will have to provide your TIN number in the space provided.
In this section of the form, you will be asked to provide information regarding the borrower, or the one paying the mortgage loan.
You will first have to provide the borrower’s TIN. Indicate this on the space provided.
Next, you will have to write down the borrower’s full legal name in no particular format. You must then write down his or her current street or residential address. You will also have to provide the corresponding city or town, state, or province, country, and appropriate ZIP code or foreign postal code.
In this section, you will need to provide information regarding the mortgage interest payment.
First, write down the amount of mortgage interest you received from payer(s)/borrower(s). Indicate this monetary amount in the space provided.
Next, write down the outstanding mortgage principal as of January 1, 2020. If the mortgage originated in 2020, show the mortgage principal as of the date of origination.
Following that, write down the mortgage origination date. This is the date when you mortgaged the loan to the borrower.
You will next be asked to write down two more monetary amounts, the amount of refund of overpaid interest and the amount of mortgage insurance premiums. Write both of these down in the appropriate spaces.
Then, write down the points paid on purchase of principal residence. These are points paid by either you or the borrower paid this year for the purchase of your principal residence that are required to be reported.
In the space below the previous line, you will be asked if the borrower’s current residential address is the same address as the property being mortgaged. If these two are the same property, indicate so by checking the box.
You must then write down the full address or description of the property securing mortgage. If this property is the same as the borrower’s current residence, see the paragraph previous to this one.
Next, write down the number of properties securing the mortgage, followed by any other information such as insurance paid from escrow or real estate taxes.
Finally, write down the mortgage acquisition date in no particular format.
Before submitting Form 1098, you must once again ensure that all information is the same across the three copies of this form.
Once you have followed every step indicated, congratulations, you have successfully completed Form 1098.