Form 1098-VLI is the IRS information return for vehicle loan interest. Lenders (and other interest recipients) use it to report interest received on a qualifying auto loan. Borrowers use the copy they receive when figuring the federal vehicle loan interest deduction on their return.
It plays the same role for vehicle loans that Form 1098 plays for mortgage interest: the person who receives the interest reports to the IRS and furnishes a statement to the borrower. There is no Form 1099-VLI. If you see that label online or on a statement, it is a misnomer for 1098-VLI.
Why the form exists
The One Big Beautiful Bill Act added a temporary federal deduction for interest on certain new passenger vehicle loans for tax years 2025 through 2028. To support that deduction — and to give the IRS a matching information return — Congress added IRC §6050AA.
Form 1098-VLI is how §6050AA gets reported. For each qualifying loan that hits the dollar threshold, it tells the IRS and the borrower:
- How much interest was received during the calendar year
- Which vehicle the loan secured (year, make, model, VIN)
- Key loan dates (origination, and acquisition date if the current holder bought the loan)
- Related amounts the instructions require (for example, outstanding principal and any refund of overpaid interest)
Official form and instructions: About Form 1098-VLI and the Instructions for Form 1098-VLI. For a field-by-field walkthrough, see Form 1098-VLI line by line.
What loan the form is about
IRS language centers on a specified passenger vehicle loan (SPVL) — the loan type that triggers reporting — and an applicable passenger vehicle (APV) — the vehicle behind that loan.
In plain terms, an SPVL is indebtedness:
- Incurred after December 31, 2024
- To purchase a qualifying new passenger vehicle for personal use
- Secured by a first lien on that vehicle
That definition is why many familiar products never generate a 1098-VLI obligation: leases, most used-vehicle loans, unsecured personal loans used at the dealership, and loans that are not first-lien purchase money on a qualifying vehicle. Related-party loans and some amounts rolled into financing (certain insurance, negative equity from a trade-in, non-vehicle property) can also fall outside what the form and the deduction are meant to cover. When the facts get messy, the instructions control.
The $600 rule. A business that receives $600 or more of interest in a calendar year on one SPVL generally must file Form 1098-VLI for that loan and furnish a copy to the borrower. The threshold is per loan, not across every account a customer has with you. Filing below $600 is optional; if you choose to file, you are still subject to the form’s rules.
Box 1 (interest received) is the headline number for borrowers. It is a starting point for the deduction, not a promise that the full amount is deductible. The annual deduction cap, income limits, and non-qualifying pieces of the loan can all reduce what belongs on the return. For how that deduction works, see what the new auto loan interest deduction is.
Who must file
The basic test
File if you are engaged in a trade or business and, in the course of that business, you receive $600 or more of SPVL interest during the calendar year from an individual, a decedent’s estate, or a nongrantor trust.
That typically includes:
- Banks and credit unions with auto portfolios
- Captive or third-party auto finance companies
- Buy-here-pay-here and other dealers that finance their own sales
- Other businesses that receive SPVL interest in a trade or business (not only “lenders” in the everyday sense)
You can owe the form even when lending is not your main line of business, as long as the interest was received in a trade or business — for example, a dealer that carries the paper. A one-off personal loan outside any business generally does not create a filing duty.
Who files when more than one party touches the money
When an owner, servicer, or purchaser is in the chain, the person who first receives the interest from the borrower generally files. A servicer collecting for an owner usually files; the owner usually does not also file for the same interest. Loan sales and servicing transfers change dates and sometimes which entity appears on the form — see who files when a loan is sold or servicing moves.
Separate form per loan
File a separate Form 1098-VLI for each SPVL that meets the threshold. Aggregating several loans onto one form is not how the reporting works.
Deadlines (tax year 2026 interest → early 2027)
| Obligation | Due |
|---|---|
| Furnish the borrower statement | January 31 |
| File with the IRS (paper) | February 28 |
| File with the IRS (electronic) | March 31 |
Failing to furnish or failing to file can each draw penalties under IRC §§6721 and 6722 — often both tracks on the same loan if both duties are missed. See 1098-VLI penalties and filing deadlines.
2025 was a transition year
For calendar year 2025 interest only, Notice 2025-57 provided transition relief:
- No Form 1098-VLI filing with the IRS was required for 2025 interest
- The interest recipient still had to make the total 2025 interest on the SPVL available to the borrower by January 31, 2026 — for example through an online portal, a regular monthly statement, an annual summary, or a similar method
- Penalties under §§6721 and 6722 were not imposed when that transition path was followed
Tax year 2026 is the first year the official Form 1098-VLI and full IRS filing apply under the normal schedule above. If you are setting up process now, design for the 2026/2027 cycle, not for the 2025 substitute-statement year.
Who receives the form
Borrowers (payers of record)
The borrower of record receives Copy B (or, for 2025, an alternative interest statement) when the recipient’s reporting duty is triggered — generally $600 or more of interest on a qualifying SPVL for the year.
Getting the form means your lender (or servicer) reported interest for that loan. It does not automatically mean you can deduct the full Box 1 amount. Eligibility still depends on the vehicle, the loan structure, personal vs business use, and income. For common eligibility questions, see used vehicles, leased vs. financed, and VIN / U.S. final assembly.
If nothing arrived
Contact the lender or servicer first. Ask for the calendar-year interest total and the vehicle/loan identifiers that belong on the statement. For 2025, an alternative statement under Notice 2025-57 was enough. From 2026 forward, expect the official Form 1098-VLI. More detail: lender didn’t send 1098-VLI.
What to spot-check when you have the form
Before you rely on the statement at filing time:
- Interest (Box 1) vs the interest portion of your payment history for the year
- VIN vs title, registration, or window sticker (character for character)
- Origination date after December 31, 2024 (refinances follow separate limitation rules — see refinance rules if that is your situation)
- Vehicle identity (year/make/model) matches the car you financed
Wrong data should be corrected with the issuer. The IRS receives a copy of what was filed; mismatches between the information return and your claim are how reviews start.
How filers and borrowers use the same form
| Role | Primary use of Form 1098-VLI |
|---|---|
| Interest recipient (filer) | Meet §6050AA: file with the IRS, furnish to the borrower, keep the process auditable |
| Borrower | Support the vehicle loan interest deduction claim; reconcile Box 1 and VIN to records |
Filers care about complete, timely, accurate reporting and penalty exposure. Borrowers care about whether the loan and vehicle qualify and how much interest they can actually deduct. Same form, different jobs.
Common mix-ups
“1099-VLI.” Does not exist. The vehicle loan interest statement is 1098-VLI.
“I got a form, so I get the full deduction.” Not necessarily. Reporting and deductibility overlap but are not identical. Box 1 can include interest the borrower must trim, and income rules can reduce or eliminate the benefit.
“Lease payments should generate 1098-VLI.” Leases are outside the SPVL definition. No form, no this deduction.
“My used car loan should be on the form.” Original use generally must begin with you. Used purchases usually do not qualify.
“2025 and 2026 work the same for lenders.” They do not. 2025 was transition relief (borrower statement, no IRS 1098-VLI filing). 2026 is full form and IRS filing.
Educational information only, not tax advice. Confirm against current IRS forms and instructions for your facts.
