What Is IRS Form 1098-E?

IRS Form 1098-E, in plain English

Form 1098-E is an information statement sent by a student loan lender or servicer showing how much
student loan interest they received from you during the year. The IRS also gets a copy. In other words:
it’s the government’s way of saying, “We see you paying interest. If you qualify, you might get a deduction.”

This form matters because student loan interest can be deductibleeven if you don’t itemize deductions. That’s a big deal
because many people take the standard deduction and still want every legal tax break they can get.

Who sends Form 1098-Eand who actually receives it?

Typically, your loan servicer (the company collecting your payments) sends Form 1098-E. Some lenders service
their own loans; others hire a servicer. If you have multiple loans with different servicers, you may receive more than one 1098-E.

The $600 rule (why some people never see a 1098-E)

In general, you should receive a 1098-E if you paid $600 or more in student loan interest during the year to
that lender/servicer. If you paid less than $600, the lender may not be required to issue the formyet your interest may still be
deductible if you otherwise qualify, as long as you can substantiate the amount.

When it arrives

Most borrowers get the form by January 31 (paper mail, online account, or both). Many servicers post it in your
online portal under “Tax Documents” or “Statements,” and you can download it for your records.

How to read Form 1098-E without squinting

Form 1098-E is short, but it packs a lot of meaning into a tiny space. Here’s how to interpret it.

Borrower and lender information

• Lender/Servicer details: Name, address, and phone number of the entity issuing the form.
• Your info: Your name and address.
• Your taxpayer ID (TIN): Often only the last four digits are shown for security.
• Account number: A reference number to identify the loan account (helpful when you have multiple loans).

Box 1: Student loan interest received by lender

Box 1 is the headline number. It shows the amount of interest the lender received from you during the calendar year.
This is the figure many taxpayers use as the starting point for the student loan interest deduction calculation.

Important nuance: for loans made on or after September 1, 2004, Box 1 generally includes certain amounts treated as
interestsuch as loan origination fees and capitalized interest received during the year.
(Capitalized interest is interest that got added to your principal balancecommon after some deferments, forbearances, or certain repayment transitions.)

Box 2: Checkbox about what Box 1 includes

Box 2 is a checkbox used mainly for older loans. If it’s checked, it indicates Box 1 does not include loan origination fees
and/or capitalized interest for certain loans made before September 1, 2004. Most borrowers with newer loans will never need to care about this box
but if you’re repaying an older loan, it’s a hint that additional rules may apply when figuring deductible interest.

What Form 1098-E is used for (and what it’s not)

It helps you claim the student loan interest deduction

The main reason you care about 1098-E is the student loan interest deduction. If you qualify, you can deduct the
lesser of $2,500 or the amount of interest you actually paid during the year.

It is not proof you must attach to your return

In most cases, you do not attach Form 1098-E to your federal tax return. You keep it for your records and use it to
enter the correct amount on your return (or into your tax software). The IRS already has a copy from the issuer.

It doesn’t guarantee you can deduct the full Box 1 amount

Even if Box 1 shows $2,500+ of interest, you might not be able to deduct all of it. Eligibility depends on filing status,
whether you can be claimed as a dependent, and income limits (more on that in a second). Also, your deductible amount can be reduced if you’re
within the phaseout range.

Do you qualify for the student loan interest deduction?

Think of the deduction like a bouncer at a club: it’s friendly, but it has rulesand it checks IDs.

Big eligibility checkpoints

• You paid interest on a qualified student loan. The loan must generally have been used for qualified higher education expenses.
• You are legally obligated to pay the interest. (Being the borrower matters.)
• Your filing status is not Married Filing Separately.
• You (and your spouse, if filing jointly) can’t be claimed as a dependent on someone else’s return.
• Your income is below the annual limit. The deduction phases out at higher incomes.

Income limits and phaseouts (why the deduction “shrinks”)

For tax year 2025, the deduction is reduced (phased out) as your modified adjusted gross income (MAGI) increases.
Many tax resources describe the phaseout range as:
$85,000 to $100,000 for Single/Head of Household/Qualifying Surviving Spouse, and
$170,000 to $200,000 for Married Filing Jointly.

Translation: if you’re under the lower number, you may be eligible for the full deduction (up to $2,500). If you’re in the middle,
you may get a partial deduction. If you’re at or above the upper number, the deduction generally disappears.

Quick example (with real-life vibes)

Let’s say Jordan is a single filer who paid $1,120 of student loan interest in 2025 and has a MAGI of $78,000.
Jordan is below the phaseout range, so they may be able to deduct the full $1,120.

Now imagine Jordan’s MAGI is $92,000 instead. That’s within the phaseout range, so the allowable deduction is typically reduced.
Tax software usually handles the math, but the key point is: higher income can mean a smaller deduction.

Where does the deduction go on your tax return?

Student loan interest is an adjustment to income (often called an “above-the-line” deduction). That means it can lower your income
even if you take the standard deduction.

For tax year 2025, it’s generally reported on Schedule 1 (Form 1040), Line 21. Your final Schedule 1 total flows
into your Form 1040 to help determine your adjusted gross income (AGI).

What if you didn’t receive a 1098-E?

Missing forms are the annual tradition nobody asked for. If you don’t have a 1098-E, here are the most common reasons:

1) You paid less than $600 in interest

Many servicers aren’t required to send the form under that threshold. Still, you may be able to deduct eligible interest if you qualify.
In that case, check your year-end statements or contact your servicer for the exact interest amount.

2) Your loan was transferred to a new servicer

Transfers can lead to confusionespecially if payments were split across two companies in the same year. You might receive two separate 1098-E forms.
Make sure you check both accounts (old and new) if you had a servicer change.

3) You went paperless (and the form is hiding online)

Many borrowers never receive a mailed form because it’s posted in the servicer’s online portal. Look for menus like “Tax Forms,” “Documents,”
“Statements,” or “Inbox.”

4) Your contact info is outdated

If your address or email changed, your form might have been sent into the void. Updating your profile with your servicer is boringbut it prevents
future scavenger hunts.

Common gotchas (a.k.a. things that trip people up)

Gotcha #1: Parent paid the loan, but whose deduction is it?

In general, the deduction belongs to the person legally obligated to pay the interest. If a parent makes payments on a loan that’s
only in the student’s name, the parent typically can’t claim the deductionbecause the parent isn’t the borrower.

However, if you are the borrower and someone else pays interest on your behalf, the tax rules can treat it like they gave you the money and you paid
the interestmeaning you (the borrower) may be the one who can potentially claim it, subject to all eligibility limits.

Gotcha #2: Employer-paid student loan interest (timing matters)

Some employer education assistance programs can pay student loan amounts, but certain employer-paid interest may not be deductible by the employee during
specific periods under IRS rules. If you’re receiving employer help, it’s worth double-checking how it affects what you can deduct.

Gotcha #3: Box 1 isn’t your total loan payment

Box 1 is interest, not principal. If you paid $4,800 total during the year and only $900 went to interest, the form will show the
interest portionnot the entire payment.

Gotcha #4: Refinancing doesn’t erase the tax paperwork

If you refinanced during the year, you may have interest paid to both the old and new lenders. That can mean multiple statements and a higher chance
you’ll forget one. (Tax software can’t import a form you never enter.)

Practical checklist: using Form 1098-E the smart way

1. Collect all 1098-E forms from every lender/servicer you paid interest to.
2. Confirm Box 1 amounts match what you see in your yearly statement totals (small differences can happen; investigate big ones).
3. Check eligibility (filing status, dependency, legal obligation, and income phaseouts).
4. Enter the deduction on your return (typically Schedule 1, Line 21 for 2025), or input it into your tax software.
5. Save the forms with your tax records in case of IRS questions later.

Conclusion: the short version you’ll actually remember

IRS Form 1098-E is your yearly “interest receipt” for student loans. If you paid enough interest and meet the IRS rules, it can help you
claim the student loan interest deductionup to $2,500without itemizing. The big keys are: get every 1098-E you’re entitled to,
understand what Box 1 represents, and confirm you qualify based on filing status, dependency rules, and MAGI limits.

Keep the form in your records, enter the right numbers on your return, and enjoy the rare joy of paying student loan interest and getting at least
a little something back.

Real-world experiences with Form 1098-E (the “this happened to me” section)

If Form 1098-E were a character in a sitcom, it would be the quiet one in the background who accidentally causes half the plot. Below are a few
very common experiences borrowers run intoso you can recognize them early and avoid the dramatic music.

Experience #1: “I didn’t get a 1098-E… did my lender forget me?”

A lot of borrowers assume that no form means no deduction. In reality, the most common reason is simple: the borrower paid less than $600 in interest,
so the servicer didn’t have to send the statement. This shows up a lot for people who are early in repayment on low balances, people who made large
principal payments (leaving little interest), or anyone whose loans were in an interest-free period for part of the year. The fix is usually not
“panic,” but “log in.” Servicers often show year-end interest totals in a portal or statement. If it’s not clearly displayed, a quick message to the
servicer can produce the exact amount. The key learning: the form is convenient, not magicalyour eligibility depends on the rules, not the envelope.

Experience #2: “Why do I have two (or three) 1098-E forms?”

This happens constantly after a servicer transfer, consolidation, or refinance. Someone pays January through June to Servicer A, then the loan moves,
and July through December payments go to Servicer B. Tax time arrives andsurpriseyou have multiple statements, each showing only part of the year’s
interest. The most frequent mistake is entering only the latest form and forgetting the earlier one, especially if the older account login was
deactivated or emails stopped. The practical workaround is to search your email for “1098-E” and to check any servicer you paid during the year,
even if you no longer pay them today. One borrower described it as “tax paperwork whack-a-mole,” which is accurate and also a great band name.

Experience #3: “My parents paid, so who gets the deduction?”

Families run into this one all the timeoften in the most confusing way possible: a parent makes payments, the student receives the 1098-E, and everyone
assumes the parent should claim it because they paid the money. But the tax rules generally care about who is legally obligated on the loan. If the loan
is only in the student’s name, the student is typically the one positioned to claim the deduction (assuming they aren’t claimed as a dependent and meet
the other requirements). Parents are often surprised because they feel like they “earned” the deduction by paying. Unfortunately, the IRS doesn’t award
tax breaks based on emotional labor (yet). The best practice is to treat it as a planning conversation: whose name is on the loan, who is filing the
return, and whether the student is still claimed as a dependent. Once you map that out, the right answer is usually much clearer.

Experience #4: “The number in Box 1 looks bigger than I expected”

Some borrowers notice Box 1 and think, “Waitdid I really pay that much interest?” Sometimes the answer is yes (interest adds up fast), but sometimes
the total reflects how student loan interest can be treated, including certain capitalized interest or origination-fee amounts depending on the loan.
This pops up after repayment changes where unpaid interest may have been added to the balance. The practical move is to compare the 1098-E to your
annual payment summary, then ask the servicer for an explanation if something seems wildly off. Most of the time it’s a timing or accounting detail,
not an errorbut you don’t want to discover a true mistake after you’ve already filed.

The common thread in all these experiences: Form 1098-E is helpful, but it’s not the whole story. A quick portal check, a careful look at who’s on the
loan, and a moment to confirm income eligibility can turn a confusing tax task into a straightforward oneno raccoon-level drawer digging required.