Mortgage sold midyear in 2025 - received two 1098s, how to handle for tax filing?

Does this apply to other items on the 1098 too? Like property taxes if they were paid from escrow? My mortgage was sold in September and I'm confused about handling the property tax amounts.

Yes, it applies to property taxes paid from escrow as well. Add the property tax amounts from both 1098 forms to get your total deductible property taxes for the year. For mortgage points or any other one-time fees, you'll want to check carefully as these should only appear on one form and shouldn't be doubled up. If you're using tax software, it should guide you through entering multiple 1098s correctly to avoid any duplicate deductions.

Did it actually tell you specifically how to handle multiple 1098s? I'm dealing with the same issue but I'm worried it'll just give generic advice.

How long did the analysis take? I'm trying to file this weekend and wondering if I have time to try this.

It actually gave very specific guidance for multiple 1098s, showing exactly which numbers needed to be added together and which ones should be entered separately in TurboTax. It even pointed out that the property tax amounts on my forms had some overlap I needed to be careful about. The analysis took less than 10 minutes from upload to getting my detailed breakdown. If you're filing this weekend, you definitely have time. I was surprised how quick it was considering how detailed the feedback was.

Wait, how does this actually work? You pay someone else to wait on hold with the IRS for you? That sounds too good to be true.

I don't buy it. There's no way any service can magically get through the IRS phone tree faster than anyone else. They're probably just charging you to wait on hold like everyone else.

It's actually quite simple - they use technology to navigate the IRS phone system and wait in the queue for you. When an agent finally picks up, you get a call back so you can speak directly to the IRS representative. You don't have to sit on hold for hours wondering if someone will ever answer. They don't have any special access to the IRS - they're just taking the painful waiting part off your plate. I was skeptical too until I tried it. I went from spending 3+ hours on multiple failed attempts to getting my question answered in a single afternoon.

This is a good point - I almost made this mistake with my HELOC and primary mortgage. How do you handle it if one of the 1098s is for a rental property? Is that entered somewhere else in tax software?

Rental property mortgage interest is handled differently than your primary residence. In most tax software, you'll enter rental property expenses (including mortgage interest) in the rental income section, not with your personal itemized deductions. This is important because rental property mortgage interest is deducted from your rental income as a business expense, even if you don't itemize deductions on your personal return. Meanwhile, your primary residence mortgage interest would only be deductible if you itemize rather than taking the standard deduction.

This happened to me too! I think it has to do with the timing of when payments are applied. Check your December payment - if you paid it late in the month, the new lender might not have counted it until January of the next year.

This is really helpful advice about checking for overlap! I'm curious - if there is an overlap in dates between the two lenders, how would you handle that? Do you subtract the overlapping amount from one of the 1098s, or is there a different way to report it to avoid double-counting the interest?

If you find overlap between the two 1098s, you should contact both lenders to clarify which one should report what. Usually what happens is that payments made right around the transfer date might get reported by both lenders, especially if there's confusion about when the sale officially took effect. The safest approach is to keep detailed records of your actual payments and dates, then work with the lenders to get corrected 1098s if needed. Don't just subtract amounts yourself - the IRS gets copies of whatever the lenders report, so you want your return to match their official forms. If you can't get corrected forms in time for filing, you might want to attach a statement explaining the discrepancy with your return. But honestly, true overlap is pretty rare - most of the time the lenders coordinate the cutoff dates pretty well.

If you find overlapping dates, you'll want to reconcile this carefully. First, pull your actual payment records from both lenders for those overlapping days. Typically, the overlap happens because one lender counts interest up to the transfer date while the other starts counting from that same date. The safest approach is to use your actual payment history to determine the correct total interest paid for the year, then adjust one of the 1098 amounts accordingly when entering it into your tax software. Most tax preparers recommend keeping detailed notes about any adjustments you make, along with copies of your payment records, in case the IRS has questions later. You could also contact both lenders to clarify the exact dates they're reporting, or use a service like taxr.ai to help verify the correct amounts before filing.

Good question, Miguel! If there's actual overlap in the dates, you'd want to carefully review your monthly statements to determine the exact interest amounts paid to each lender. You should only deduct the interest you actually paid, not what's reported if there's double-counting. The best approach is to use your actual payment records as the authoritative source. Add up all the interest you actually paid throughout the year from your statements, and use that total for your deduction. Keep both 1098s for your records, but you might want to attach a note explaining the discrepancy if the IRS ever questions it. If the overlap is significant, you could also contact one of the lenders to request a corrected 1098, though that might take a while to process.

If you find there's an overlap between the two 1098s, you'll want to carefully review your monthly statements to determine the actual interest paid. Generally, you should report only the interest you actually paid, not what's duplicated on the forms. The safest approach is to keep detailed records of your payments and use those to verify the totals. If there's a small overlap (like a day or two during the transfer), you can usually subtract the duplicate amount from one of the forms when entering into your tax software. Just make sure to document which adjustment you made and why, in case the IRS has questions. For significant overlaps, you might want to contact one or both lenders to request a corrected 1098, as this could indicate an error in how they reported the transfer date.

Good question Miguel! If you find overlap in the dates, you'll want to use your actual payment records as the authoritative source rather than trying to modify the 1098 amounts yourself. The IRS expects you to report the mortgage interest you actually paid, not necessarily the exact amounts on the 1098s. In cases of overlap, I'd recommend documenting the discrepancy and using your loan statements to calculate the correct total interest paid for the tax year. You can attach a statement to your return explaining any significant differences between your reported amount and the 1098 totals. Most tax software has a section where you can enter adjustments or explanations for situations like this. The key is being able to substantiate whatever amount you claim with your actual payment history if the IRS ever asks.

Good question! If you find overlap in the dates, you'll want to check your actual payment records and loan statements to determine which lender actually received your payment for those overlapping days. Typically, you'd only count the interest paid to the lender who actually processed your payment during that period. Most tax software won't automatically detect this overlap, so you might need to manually adjust one of the 1098 amounts when entering them. Keep documentation of your adjustment - like a copy of your payment history showing which lender received payments on which dates - in case the IRS has questions later. If the overlap is small (just a day or two), it's usually not worth the hassle to adjust, but if it's a week or more, it could make a noticeable difference in your deduction amount.

Great question! If you find overlap between the two 1098s, you should use your actual payment records as the authoritative source rather than modifying the 1098 forms themselves. Don't subtract amounts from the 1098s - instead, report the actual interest you paid based on your loan statements. Most tax software has a field where you can enter "mortgage interest paid" that differs from your 1098 total if needed. You'd enter this adjusted amount and keep documentation showing why the 1098s don't match your actual payments. The key is to only deduct what you actually paid, not what the forms show if there's double-counting. In my experience, true overlap is pretty rare - usually what looks like overlap is just timing differences in how the lenders processed payments around the transfer date.

If you find overlapping dates, the safest approach is to compare your actual payment records with what's reported on both 1098s. You should only deduct what you actually paid in interest during the tax year, not what the lenders reported if there's double-counting. In most tax software, you can manually adjust the amounts when entering the 1098s if you identify a specific overlap. Just make sure to keep detailed documentation of your adjustment - print out your payment history showing the actual interest paid and note which dates were double-reported. This way if the IRS ever questions the discrepancy between your reported deduction and the sum of the 1098s they received, you have clear evidence of the correction. Another option is to use the total from your year-end mortgage statements rather than the 1098s if the overlap is significant, but definitely consult a tax professional if the difference is substantial.

Great question! If you find an overlap, you should go with what your actual payment records show rather than just adding the 1098s together. Pull up your mortgage statements for the overlap period and see exactly how much interest you actually paid. For example, if both lenders reported interest for July 15th but you only made one payment that day, use your statement to determine which lender actually received that payment. Then you can adjust accordingly when entering the forms in your tax software. If the overlap is small (like a day or two), it might not make a significant difference in your taxes, but it's still worth being accurate. The IRS cares more about you reporting what you actually paid than perfectly matching every 1098 to the penny.

Great question! If you find overlap in the dates, you'll want to look at your actual payment records to see which lender actually received the interest payment for those overlapping days. Usually what happens is that one lender will report the interest they were supposed to receive (even if the payment was sent to the new lender by mistake), while the other reports what they actually collected. In most cases, you should use the total that matches your actual payments made during the year. If both 1098s combined exceed what you actually paid, you can report the lower, accurate amount. Just make sure to keep documentation showing your actual payment history in case the IRS questions the discrepancy. The key is that you're only deducting interest you actually paid, not what the lenders think they should have received.

Good question, Miguel! If you find an overlap, you should use your actual payment records as the authoritative source rather than trying to adjust the 1098 forms themselves. The best approach is to calculate the correct total interest paid from your monthly statements and use that figure. If there's a significant discrepancy, you might want to contact one or both lenders to request corrected 1098 forms. However, if the overlap is just a day or two and represents a small amount, most tax professionals would say to go with your payment records and document the calculation in case of any questions later. The key is making sure your deduction matches what you actually paid in interest for the tax year - not necessarily what the 1098s say if there are reporting errors.

Great question! If there's an overlap, you'll want to carefully review your actual payment records to determine the true interest paid. Don't modify the 1098 forms themselves - instead, when filing your taxes, report the accurate total based on your records. If the overlap creates a discrepancy, you can attach a statement to your return explaining the situation (something like "Mortgage transferred mid-year, adjusted for overlapping interest reporting"). Most tax software has a section for additional explanations. The key is making sure your reported interest matches what you actually paid, not just blindly adding the 1098 totals if they contain duplicated amounts. Keep detailed records showing how you calculated the correct amount in case the IRS has questions later.