Overlooked a 1098 mortgage form for $3500, should I amend my tax return?

Whether amending is "worth it" really depends on your tax situation. That mortgage interest could definitely make a difference if you're itemizing deductions rather than taking the standard deduction. First, check if you're even itemizing on Schedule A. With the higher standard deductions these days ($29,200 for married filing jointly in 2024), many people don't benefit from itemizing unless they have substantial deductions. If you took the standard deduction, adding this mortgage interest won't change anything. If you are itemizing, then yes, an additional $4600 in mortgage interest could reduce your taxable income by that amount. How much that saves depends on your tax bracket - if you're in the 22% bracket, that could be around $1000 in tax savings. The amendment process isn't super complicated, but it does take time. Form 1040-X needs to be filed by paper (not electronically), and amended returns can take 16+ weeks to process. Your tax preparer will likely charge a fee, so factor that into your decision too.

Had almost the exact same situation last year with a missing 1098 form! I tried figuring it out myself and got super frustrated with all the IRS forms and rules. Then I found this service called taxr.ai (https://taxr.ai) that saved me so much stress. It analyzed my tax situation including the missing mortgage interest form and gave me a clear answer about whether amending was worth it for MY specific situation. The tool looked at my filing status, income bracket, and whether I was already itemizing, then showed me exactly how much money I'd save by amending versus the costs involved. In my case, I was already itemizing and the extra mortgage interest saved me about $800 in taxes, so definitely worth the amendment. But the tool actually calculated my exact benefit rather than me just guessing.

Just wanted to follow up about that taxr.ai site someone recommended. I was the one asking about my missed 1099 situation. I decided to give it a try and was honestly impressed. The analysis showed I definitely needed to amend (no surprise since it was income), but it calculated the exact tax impact including the small penalty I'd owe. The best part was it showed me exactly which forms I needed to file and gave step-by-step instructions. Way easier than the confusing IRS website. It even estimated how long the amendment would take to process based on current IRS backlog data. Worth checking out if you're in a similar situation with that missed 1098 form.

If you decide to amend, be prepared for a LONG wait to hear back from the IRS. I amended last year and it took 9 months to process! I called the IRS about 20 times and never got through - just endless hold music until disconnected. Finally found this service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent who confirmed my amendment was received but sitting in backlog. You can see how it works here: https://youtu.be/_kiP6q8DX5c. Basically they use some tech to hold your place in line and call you when an agent is available. The IRS agent was able to flag my amendment for review since it had been so long, and I got my refund within 3 weeks after that call. Just something to consider if you do amend and then get stuck waiting forever with no updates.

I need to eat my words about that Claimyr service. After dismissing it as a scam, I was still stuck with my IRS issue and getting desperate. Decided I had nothing to lose and tried it. Got connected to an IRS agent the next day after MONTHS of failed attempts calling on my own. The agent actually fixed my issue in about 15 minutes once I explained the situation. Turns out my amended return from last year was sitting in a processing center with a flagged error that no one had reviewed. Still can't believe it worked after all my failed attempts. If you're amending for that mortgage interest, just be prepared for potential delays and know there are options if you get stuck in the IRS black hole of processing.

Before you do anything, check if you've taken the standard deduction or itemized! I made this exact mistake last year (forgot mortgage interest from a rental property refinance). If you took the standard deduction, amending won't help since you need to exceed the standard deduction amount with your total itemized deductions for it to matter. But if you itemized or you're right on the borderline where this would push you over, then absolutely amend. Also, if you go through with an amendment, do it ASAP. The longer you wait, the more complicated it gets. And keep copies of EVERYTHING. The IRS is still playing catch-up from their backlog.

Another thing to consider - if you're getting a refund from the amendment, the IRS pays interest on that money (and the interest is taxable next year, fun). But if amending means you OWE money, you'll probably have to pay interest and possibly penalties too. The current interest rate the IRS charges is like 7-8% I think? So that's another factor in deciding if it's "worth it" - the longer you wait, the more interest accumulates either way.

The $4600 in mortgage interest could definitely be worth amending, but it really depends on whether you itemized or took the standard deduction. If you took the standard deduction and this wouldn't push your total itemized deductions above that threshold, then amending won't help. However, if you were already itemizing or this would tip you over into itemizing territory, you're looking at potential tax savings in the hundreds to over $1000 range depending on your tax bracket. One thing to keep in mind - you have 3 years from the original filing date to amend, so there's no immediate rush. But the sooner you do it, the sooner you'll get any refund (plus the IRS pays interest on amended return refunds). The processing time is definitely slow right now - expect 4-6 months minimum. I'd suggest pulling out your original return and checking Schedule A to see if you itemized. If you did, or if adding this $4600 to your other potential deductions (state taxes, charitable donations, etc.) would exceed your standard deduction amount, then it's probably worth the hassle and fee to amend.