Commercial Loan Interest Not Reportable?

[Brandi K.]

I have a 7 unit property which we have a held in LLC and mortgage is also in LLC. In getting ready to get our taxes done I reached out to the bank about not receiving anything for what was paid in interest. They told me it was un reportable and would not provide anything other than a statements showing what was paid each month for principle and interest. I'm confused about this. Does this sound right to anyone with experience with commercial mortgages?

Thanks!

[Kyle J.]

The bank is not required to send a 1098 if the interest they received from you is less than $600 or if the interest is “received from a corporation, partnership, trust, estate, association, or company (other than a sole proprietor) even if an individual is a coborrower and all the trustees, beneficiaries, partners, members, or shareholders of the payer of record are individuals.”

You can read the instructions (and exceptions) for the form here:

https://www.irs.gov/instructions/i1098

Whether or not they send the form, you should still be able to deduct the interest you paid if it’s a valid business expense.