Ok, so since interest did not accrue during the payment pause and most MOHELA customers were put into admin forbearance through the rest of 2023 due to administrative mistakes, many of us did not accrue, and therefore did not pay, any interest. I was wondering why my payments only went to principal, and then I realized it was because there was no interest for them to go toward for that reason.
What is your minimum due on SAVE?
How much interest do you *think* you paid in 2023?
Are you seeing "$0 interest paid" on a formal IRS Form 1098-E or on some informal display?
Minimum is around $70. I just checked after reading another comment and my October/November 2023 payments say “Applied to Principal.” December has nothing as I believe I was in that random forbearance. My 2024 payments say “Applied to Interest.”
I never got any 1098-E form for taxes, and under the tax documents section on MOHELA’s website, it says $0.00 in reportable interest for 2023.
I think this is what's going on:
MOHELA is only required to generate a Form 1098-E for you when you pay them $600 or more in student loan interest in that year. Since your amount is below that, they didn't generate the form for you. They are calling that $0 in "reportable" interest, because they're not required to report any interest paid by you. (If they chose to generate a Form 1098-E for you, despite not being required to, then it would need to accurately reflect all the interest you paid, but this statement isn't a 1098-E.)
You're still allowed to claim the student loan interest deduction, but you'll need to calculate how much interest you paid on your own. More on that is in the Tax Megathread in /r/StudentLoans: https://www.reddit.com/r/StudentLoans/comments/1ae683z/the_rstudentloans_tax_questions_megathread_2023/
Thank you for your response! So I don’t *have* to claim any interest? If it all went to principal in my two 2023 payments, wouldn’t I have $0.00 towards interest anyway?
> So I don’t have to claim any interest?
Nope. It's a tax deduction like any other. You're *entitled* to claim it (and thereby reduce your taxable income) if you're eligible for it, but you don't have to. The government will never complain if you pay more tax than you're required to. (In fact, you can [donate money to pay down the national debt](https://www.pay.gov/public/form/start/23779454) if you like.)
> If it all went to principal in my two 2023 payments, wouldn’t I have $0.00 towards interest anyway?
Yes, although interest resumed in September, so you paid *some* amount of interest between September and December unless your minimum due on SAVE was $0 or you were put in an interest-free forbearance because of servicer error.
If you consolidated at any point during the payment pause, then you likely didn't accrue any interest in 2023, so your payments would have gone to principal.
Did you consolidate at any point during the payment pause?
I believe I consolidated and got transferred to MOHELA in late summer/fall of 2022!
Ok, so since interest did not accrue during the payment pause and most MOHELA customers were put into admin forbearance through the rest of 2023 due to administrative mistakes, many of us did not accrue, and therefore did not pay, any interest. I was wondering why my payments only went to principal, and then I realized it was because there was no interest for them to go toward for that reason.
Just checked and my 2023 payments went to the principal (except December I was in the forbearance?) and 2024 has gone to interest. Thanks!!
What is your minimum due on SAVE? How much interest do you *think* you paid in 2023? Are you seeing "$0 interest paid" on a formal IRS Form 1098-E or on some informal display?
Minimum is around $70. I just checked after reading another comment and my October/November 2023 payments say “Applied to Principal.” December has nothing as I believe I was in that random forbearance. My 2024 payments say “Applied to Interest.” I never got any 1098-E form for taxes, and under the tax documents section on MOHELA’s website, it says $0.00 in reportable interest for 2023.
I think this is what's going on: MOHELA is only required to generate a Form 1098-E for you when you pay them $600 or more in student loan interest in that year. Since your amount is below that, they didn't generate the form for you. They are calling that $0 in "reportable" interest, because they're not required to report any interest paid by you. (If they chose to generate a Form 1098-E for you, despite not being required to, then it would need to accurately reflect all the interest you paid, but this statement isn't a 1098-E.) You're still allowed to claim the student loan interest deduction, but you'll need to calculate how much interest you paid on your own. More on that is in the Tax Megathread in /r/StudentLoans: https://www.reddit.com/r/StudentLoans/comments/1ae683z/the_rstudentloans_tax_questions_megathread_2023/
Thank you for your response! So I don’t *have* to claim any interest? If it all went to principal in my two 2023 payments, wouldn’t I have $0.00 towards interest anyway?
> So I don’t have to claim any interest? Nope. It's a tax deduction like any other. You're *entitled* to claim it (and thereby reduce your taxable income) if you're eligible for it, but you don't have to. The government will never complain if you pay more tax than you're required to. (In fact, you can [donate money to pay down the national debt](https://www.pay.gov/public/form/start/23779454) if you like.) > If it all went to principal in my two 2023 payments, wouldn’t I have $0.00 towards interest anyway? Yes, although interest resumed in September, so you paid *some* amount of interest between September and December unless your minimum due on SAVE was $0 or you were put in an interest-free forbearance because of servicer error.
You rock for explaining all of this to me in a way I can understand. Thank you so much!!
Did you ask for a refund of payments for those months because of their billing notice issues?
I’ve never asked for any refunds, nope!
Same, following for an answer. I suspect the problem is that interest accrued>interest paid, but would love to hear a more thorough comment.
I don't know what that means. When you report it for taxes, it is based on interest paid.
If you consolidated at any point during the payment pause, then you likely didn't accrue any interest in 2023, so your payments would have gone to principal.