Understanding Year-End Mortgage Tax Forms

Tax season can be a hectic time for gathering the documents needed to file your taxes, and we want to help. This article will provide an overview to aid in your tax preparation process and answer many commonly asked questions.

Your year-end tax documents: The 1098 Statement

One of the most important documents you should make sure you have is the year-end 1098 Statement. This statement provides the mortgage interest you have paid on your mortgage loan during the calendar year and is reported to the Internal Revenue Service.

While the 1098 statement provides the total amount of interest you paid during the calendar year, this may not be the total amount of interest you can claim. IRS regulations specify how many monthly or biweekly payments with interest can be claimed, as well as the maximum amount of interest that can be claimed. Check with your tax advisor for the specific tax benefits possible for your situation.

On the 1098 statement, you will see other fields that may or may not contain information applicable to your mortgage loan for the tax year reported.

The 1098 form fields can include:

  • Points paid at closing on the purchase of a principal residence
  • Refund of overpaid interest
  • Any mortgage insurance premiums paid throughout the year

The 1098 statement also reports the outstanding principal balance as of January 1 of the tax year being reported and the mortgage loan origination date. You may also see a box labelled “Other” that contains Property Taxes, Late Charges, Principal Paid, and Ending Principal Balance. None of the amounts shown in the “Other” box are reported to the IRS.

When will I receive my Form 1098?

This is very important, because it impacts your tax preparation process and the timely submission of your tax return. A paper copy of the 1098 form is mailed no later than January 31st following the tax year being reported.

Please allow several weeks for postal delivery as this is generally a busy time. The envelope that contains your 1098 statement can be recognized by the wording "Important Tax Information Enclosed." However, for online mortgage access, 1098 information is estimated to be available online in mid-January following the tax year being reported. If you have online access, please check during this timeframe.

If you need a copy of your 1098 statement and you have online mortgage access, you can view and print your 1098 online. In addition, since your 1098 information has already been reported to the Internal Revenue Service, you can simply report the numbers that are shown online or that are given to you by a customer service representative. A paper copy is not required for the IRS.

If you still need a duplicate copy of your 1098 form, requests can be made by contacting Customer Service. Please keep in mind that duplicate 1098 requests will not be accepted until mid-February following the tax year being reported. It may be better to access the 1098 online and print it at home, or create a PDF to send to your tax preparer.

There are special circumstances regarding end of year tax reporting that need to be considered as well, such as in the case where your mortgage servicer changed during the tax year. If this is the case, as a result of this change, you may receive two partial year 1098 statements. Please contact each mortgage servicer if you have questions about partial year 1098s.

Can the name on my 1098 form be changed for tax reporting?

No. The 1098 must remain in the name of the primary borrower as reflected on your mortgage note.

Can the 1098 be faxed or emailed?

The 1098 statement cannot be faxed or emailed; it can only be sent by U.S. Mail. But remember, if you have online access, you can view and print your 1098 information without needing the paper copy.

Your year-end tax documents: The 1099 Statements

When will I receive my 1099-INT?

The 1099 Interest form is typically referred to as the 1099-INT. This document is sent if you had an escrow account that earned $10.00 or more in interest throughout the tax year. If your account earned less than $10.00 in interest, a form will not be sent. You should receive this at the same time as the 1098, and it should be available for online access at the same time.

Not all escrow accounts earn interest, and if your account does, the amount earned is determined by State guidelines; it is not related to your mortgage loan’s interest rate. The amount of escrow interest earned includes changes to the amount of funds in your escrow account.

What about 1099 tax forms for special situations?

There are several other year-end tax documents that could be sent depending on your individual situation. These forms include a 1099-A for loans that have completed foreclosure and a 1099-C for loans with loss mitigation activity.

Also note that an annual escrow statement is not an official IRS form, but it’s an important statement that should be used in helping you and your tax advisor prepare your return.

If you have any questions about your mortgage loan end of year tax documents, please contact us directly for assistance. For specific tax related questions, however, please consult with your tax advisor or the Internal Revenue Service. Contact a Customer Service Center Advisor today at 855-241-5702 from 8 a.m. to 5 p.m. ET, Monday through Friday. Please note that this information is intended for Santander customers in the United States; different rules and regulations apply to our customers outside of the United States.

Santander Bank does not provide financial, tax or legal advice and the information contained in this article does not constitute tax, legal or financial advice. Santander Bank does not make any claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in this article. Readers should consult their own attorneys or other tax advisors regarding any financial strategies mentioned in this article. These materials are for informational purposes only and do not necessarily reflect the views or endorsement of Santander Bank.