Instructions for Form 1098-VLI (Rev. December 2026)

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Instructions for Form
1098-VLI
(December 2026)

Section references are to the Internal Revenue Code
unless otherwise noted.

decedent’s estate, or nongrantor trust. Report only interest
on an SPVL, defined later.

Future Developments

File a separate Form 1098-VLI for each SPVL. The
$600 threshold applies separately to each SPVL. You are
not required to file Form 1098-VLI for an SPVL on which
you have received less than $600 in interest, even if an
individual paid you over $600 in total on multiple SPVLs.
If you choose to file Form 1098-VLI to report interest on
an SPVL of less than $600, you are subject to the rules in
these instructions.

For the latest information about developments related to
Form 1098-VLI and its instructions, such as legislation
enacted after they were published, go to IRS.gov/
Form1098VLI.
You can get Pub. 1099, General Instructions for Certain
Information Returns, at IRS.gov/Pub1099.

In addition to these specific instructions, you should use
the current Pub. 1099, General Instructions for Certain
Information Returns. Those general instructions include
information about the following topics.
• Who must file.
• When and where to file.
• Electronic reporting.
• Corrected and void returns.
• Statements to recipients.
• Taxpayer identification numbers (TINs).
• Backup withholding.
• Penalties.
• Other general topics.

Continuous use. Use the December 2026 Form
1098-VLI and these instructions for calendar year 2026
and subsequent years until a superseding revision is
issued.
E-filing returns. The Taxpayer First Act of 2019
authorized the Department of the Treasury and the
IRS to issue regulations that reduce the 250-return
e-file threshold. T.D. 9972, published February 23,
2023, lowered the e-file threshold to 10 (calculated
by aggregating all information returns), effective for
information returns required to be filed on or after January
1, 2024. Go to IRS.gov/InfoReturn for e-file options.
Information Returns Intake System (IRIS). The IRS
has developed IRIS, an online portal for e-filing
information returns. Go to IRS.gov/IRIS for more
information.
Online PDF fillable Copy B. To ease statement
furnishing requirements, Copy B is fillable online in a
PDF format, available at IRS.gov/ Form1098VLI. You can
complete this copy online for furnishing statements to
recipients and for retaining in your own files.

Specific Instructions

Use Form 1098-VLI, Vehicle Loan Interest Statement,
to report interest of $600 or more you received on a
specified passenger vehicle loan (SPVL) during the year
in the course of your trade or business from an individual,

Aug 12, 2026

If an overpayment of interest on an SPVL was made
in a prior year and you refund or credit that overpayment,
you may have to file Form 1098-VLI to report the refund
or credit of the overpayment. See Reimbursement of
Overpaid SPVL Interest, later.

Specified Passenger Vehicle Loan (SPVL)

An SPVL is any indebtedness incurred after 2024 for
the purchase of an applicable passenger vehicle (APV)
(defined later) for personal use and that is secured by a
first lien on that APV.
Indebtedness is an SPVL only to the extent it is
incurred for the purchase of an APV and, if part of
the same purchase transaction, for any other items
or amounts customarily financed in an APV purchase
transaction that are directly related to the purchase
of the APV. Items or amounts customarily financed in
an APV purchase transaction that are directly related
to the purchase of the APV include, but are not
limited to, vehicle service or repair plans (for example,
mechanical repair coverage), vehicle protection products
(including tire, wheel, paint, and interior protection
products), key fob replacement plans, warranties or
extended warranties, guaranteed asset protection (GAP)
waiver or insurance that covers the difference between
an APV’s value and the outstanding balance of the
indebtedness in the event of a total loss, credit insurance
products (including credit-related accident, health, and
life products), sales taxes, vehicle-related fees (including
title and registration fees), and vehicle-related accessories
that are components of the APV purchased as part of the
APV transaction.
To the extent any indebtedness is not incurred for the
purchase of an APV or for any other items or amounts
customarily financed in an APV purchase transaction that
are directly related to the purchase of the APV, such
indebtedness is not an SPVL even if it is incurred as part
of the purchase of the APV. An SPVL does not include,
for example, indebtedness incurred for the repayment of
negative equity on a loan secured by a trade-in vehicle,
to purchase collision and liability insurance that is not
a credit insurance product, or to purchase any property
or services unrelated to an APV (for example, a trailer
or a boat). In addition, indebtedness is not incurred

Instructions for Form 1098-VLI (12-2026) Catalog Number 95934D
Department of the Treasury Internal Revenue Service www.irs.gov

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Reminders

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for the purchase of an APV or for any other items
or amounts customarily financed in an APV transaction
that are directly related to the purchase of the APV to
the extent the indebtedness relates to cash proceeds
received from the lender. Indebtedness that includes both
qualifying and nonqualifying items or amounts must be
allocated between the portion that qualifies as an SPVL
and the portion that does not qualify as an SPVL and
only interest attributable to the portion that qualifies as an
SPVL must be reported on Form 1098-VLI. For example,
if a purchaser incurs indebtedness that includes both the
purchase of an APV secured by a first lien for personal
use and a trailer, only the portion of the indebtedness
allocated to the APV qualifies as an SPVL. In that case,
only the interest related to that portion of the indebtedness
must be reported. See Regulations section 1.163-16(d)(2)
(iii).

Note: An SPVL does not include any loan owed to you
by a person who is related to you within the meaning of
section 267(b) or 707(b)(1).
Refinanced SPVL. If a purchaser refinances an SPVL
(refinanced loan), the resulting indebtedness (new loan)
is an SPVL if the new loan is secured by a first lien on
the APV with respect to which the refinanced loan was
incurred. The amount of the new loan that is an SPVL
is limited to the outstanding balance of the refinanced
loan as of the date of the refinancing. A purchaser must
allocate principal and interest between the amount of the
new loan that is an SPVL and the remaining portion of
the indebtedness on a pro-rata basis. If there is a change
in obligor as part of the refinancing, the new loan is not
an SPVL with regard to any subsequent obligor, unless
the refinancing is in connection with a change in obligor
resulting from the obligor’s death. See Regulations section
1.163-16(d)(4).
Change in obligor. A loan ceases to be an SPVL if the
person that incurred the SPVL ceases to be the obligor
and another person becomes the obligor. However, a
change in obligor due to a previous obligor’s death does
not preclude the loan from continuing to qualify as an
SPVL. A change in obligor by reason of a previous
obligor’s death could occur, for example, when an obligor
inherits an APV subject to a loan originated by the person
who died. See Regulations section 1.163-16(d)(5).
Note: Do not file Form 1098-VLI unless the loan was
secured by a first lien on the APV at the time the loan was
incurred.

Applicable Passenger Vehicle (APV)

In general, an APV is any vehicle that meets the following
requirements.
• The original use (defined later) of the vehicle begins
with the payer of record.
• It is a motor vehicle manufactured primarily for use
on public streets, roads, and highways, not including a
vehicle operated exclusively on a rail or rails.
• It has at least 2 wheels.
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Original Use

Original use of a vehicle begins with the first person
that takes delivery of the vehicle after the vehicle is
sold, registered, or titled. In the case of a purchaser that
incurs indebtedness to purchase a vehicle, original use
of the vehicle does not begin with that purchaser unless
the vehicle is treated as a new vehicle under the loan
documentation.
However, original use of a vehicle held by a dealer does
not begin with the dealer if the vehicle is held primarily
for sale to customers in the ordinary course of its trade or
business.
If more than one person purchases a vehicle and one
of these purchasers is the first person that takes delivery
of the vehicle after the vehicle is sold, registered, or titled,
then each of these purchasers is considered to be the first
person that takes delivery of the vehicle after the vehicle is
sold, registered, or titled.
If a purchaser that is not a dealer returns a vehicle to
a seller within 30 days of taking delivery of the vehicle,
then that purchaser will not be considered the first person
that takes delivery of the vehicle after the vehicle is sold,
registered, or titled, and, accordingly, original use of the
vehicle does not begin with that purchaser.
For more information, see Regulations section
1.163-16(e)(2).

Final Assembly in the United States

To determine whether final assembly of the vehicle
occurred within the United States, you may rely on the
vehicle’s plant of manufacture as reported in the VIN.
See the National Highway Traffic Safety Administration
VIN Decoder website, available at nhtsa.gov/vin-decoder.
Alternatively, you may rely on the final assembly point
reported on the label affixed to the vehicle. This label
is attached to each vehicle on a dealer’s premises. See
Regulations section 1.163-16(e)(3).

Payer of Record

The payer of record is the person carried on your books
and records as the principal borrower. If your books and
records do not indicate which borrower is the principal
borrower, you must designate one. The payer of record
must be an individual, nongrantor trust, or decedent’s
estate.
Multiple borrowers. Even though there may be more
than one borrower on the SPVL, you are required to
prepare Form 1098-VLI only for the payer of record, and
only if such payer of record is an individual, decedent’s
estate, or nongrantor trust, showing the total interest
received on the SPVL.

Payments By Third Parties

Report all interest received on the SPVL as received from
the payer of record. For example, if the borrower’s parent
Instructions for Form 1098-VLI (12-2026)

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If an APV was replaced with a substitute APV due to an
unforeseen intervening event as described in Regulations
section 1.163-16(c)(3)(ii), then you must report the vehicle
identification number (VIN) of the substitute APV on Form
1098-VLI.

• It is a car, minivan, van, sport utility vehicle, pickup
truck, or motorcycle. See Regulations section 1.163-16(b)
(14).
• It has a gross vehicle weight rating of less than 14,000
pounds.
• Final assembly of the vehicle occurred within the United
States. See Final Assembly in the United States, later.

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makes payments on the SPVL, the interest received from
the parent is reportable on Form 1098-VLI as received
from the payer of record.

Lender of Record

A lender of record is the person who, at the time the SPVL
is made, is named as the lender on the loan documents
and whose right to receive payment from the payer of
record is secured by the payer of record’s APV. Even if
the lender of record intends to sell or otherwise transfer
the SPVL to a third party after the close of the transaction,
such intention does not change who the lender of record
is.

Who Must File

Not in the lending business. If you receive SPVL
interest of $600 or more in the course of your trade or
business, you are subject to the requirement to file Form
1098-VLI, even if you are not in the business of lending
money. For example, if you are a dealer and you provide
financing to an individual to buy an APV, and the financing
is secured by a first lien on the APV, you are subject to this
reporting requirement. However, if you are a physician not
engaged in any other business and you lend money to an
individual to enable that individual to buy an APV from a
dealer and you have a first lien on the APV, you are not
subject to this reporting requirement because you did not
receive the interest in the course of your trade or business
as a physician.
Collection agents. Generally, if you receive reportable
SPVL interest payments on behalf of someone else and
you are the first person to receive the interest, such as
a servicing bank collecting payments for a lender, you
must file this form. Enter your name, address, Taxpayer
Identification Number (TIN), and telephone number in the
RECIPIENT’S/LENDER’S entity area. You must file this
form even though you do not include the interest received
in your income but you merely transfer it to another
person. The person for whom you collected the interest
does not need to file Form 1098-VLI.
There is an exception to this rule for any period that (a)
the first person to receive or collect the interest does not
have the information needed to report on Form 1098-VLI,
and (b) the person for whom the interest is received or
collected would receive the interest in its trade or business
if the interest were paid directly to such person. If (a)
and (b) apply, the person on whose behalf the interest
is received or collected is required to report on Form
1098-VLI. If interest is received or collected on behalf of
another person other than an individual, such person is
presumed to receive the interest in a trade or business.
Foreign SPVL interest recipient. If you are not a U.S.
person, you must file Form 1098-VLI if the interest is
received in the United States. A U.S. person is a citizen
or resident of the United States, a domestic partnership or
corporation, or a nonforeign estate or trust. If the interest
is received outside the United States, you must file Form
1098-VLI if (a) you are a controlled foreign corporation, or
Instructions for Form 1098-VLI (12-2026)

Nonresident Alien SPVL Interest Payer

Do not file Form 1098-VLI if the payer of record is a
nonresident alien individual, foreign nongrantor trust, or
foreign estate. See Regulations section 1.6050AA-1(e).

Report the SPVL interest based on the following
documentation rules.
• If the interest is paid within the United States, you must
request from the payer of record the applicable Form
W-8 (withholding certificate) as described in Regulations
section 1.1441-1(e)(4).
• If the interest is paid outside the United States,
you must satisfy the documentary evidence standard
described in Regulations section 1.6049-5(c).

Prepaid SPVL Interest

Report prepaid interest only in the year in which it properly
accrues.
Exception. Interest received during the current year that
will properly accrue in full by January 15 of the following
year may be reported on Form 1098-VLI for the current
year. However, if any part of an interest payment accrues
after January 15, then only the amount that properly
accrues by December 31 of the current year is reportable
on Form 1098-VLI for the current year. See Regulations
section 1.6050AA-1(f)(2). For example, if you receive a
payment of interest that accrues for the period December
20 through January 20, you cannot report any of the
interest that accrues after December 31 for the current
year. You must report the interest that accrues after
December 31 on Form 1098-VLI for the following year.

Reimbursement of Overpaid SPVL Interest

You are required to report reimbursements of overpaid
interest totaling $600 or more to a payer of record on Form
1098-VLI. You are not required to report reimbursements
of overpaid interest aggregating less than $600 unless you
are otherwise required to file Form 1098-VLI. However,
you may report any reimbursement of overpaid interest
that you are not otherwise required to report, but if you do,
you are subject to the rules in these instructions.
The reimbursement must be reported on Form
1098-VLI for the year in which the reimbursement is
made. No change should be made to the prior-year Form
1098-VLI because of this reimbursement. Report the total
reimbursement even if it is for overpayments made in
more than 1 year.
To be reportable, the reimbursement must be a refund
or credit of SPVL interest received in a prior year that
was required to be reported for that prior year by any
interest recipient on Form 1098-VLI. Only the person
who makes the reimbursement is required to report it on
Form 1098-VLI. For example, if you acquired an SPVL on
which interest was overpaid in a prior year, you made a
reimbursement of the overpaid interest, and the previous
SPVL holder was required to report SPVL interest on
Form 1098-VLI in the prior year, you must file Form
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File Form 1098-VLI if you are engaged in a trade or
business and in the course of such trade or business
you receive from an individual, decedent’s estate, or
nongrantor trust $600 or more of interest on any one SPVL
during the calendar year.

(b) at least 50% of your gross income from all sources
for the 3-year period ending with the close of the tax
year preceding the receipt of interest (or for such part
of the period as you were in existence) was effectively
connected with the conduct of a trade or business in the
United States. See Regulations section 1.6050AA-1(d).

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Overpayment and reimbursement in same year. If
you reimburse interest in the same year it is overpaid,
do not report the overpayment on Form 1098-VLI as
interest received during the year or as a reimbursement of
overpaid interest. For example, if the borrower paid $5,000
and you reimbursed $500 of that amount in the current
year, enter $4,500 in box 1 as interest paid by the payer of
record. Do not enter the $500 reimbursement in box 5.
Interest on reimbursement. A financial institution (or
its middleman) that pays interest of $10 or more on
the reimbursement must report that interest on Form
1099-INT, Interest Income. Others that pay interest that
meets or exceeds the applicable reporting threshold in the
course of their trade or business must report that interest
on Form 1099-INT. Do not include such interest on Form
1098-VLI.

Statement to Payer of Record

If you are required to file Form 1098-VLI, you must
provide a statement to the payer of record. For more
information about the requirement to furnish an official
form or acceptable substitute to the payer of record, see
part M in Pub. 1099.

Truncating payer of record’s TIN on payee state­
ments. Pursuant to Regulations section 301.6109-4, all
filers of this form may truncate a payee’s TIN (social
security number (SSN), individual taxpayer identification
number (ITIN), adoption taxpayer identification number
(ATIN), or employer identification number (EIN)) on payee
statements. Truncation is not allowed on any documents
the filer files with the IRS. A recipient’s/lender’s TIN may
not be truncated on any form. See part J in Pub. 1099 for
more information.

RECIPIENT’S/LENDER’S Name, Address, and
Telephone Number Boxes

Enter the name, address, and telephone number of the
filer of Form 1098-VLI. Use this same name and address
on Form 1096 if you are filing on paper.

PAYER OF RECORD’S Name and Address Boxes
Enter the name and address, in the appropriate boxes, of
the payer of record.

4

Account Number

The account number is required if you have multiple
accounts for a payer of record for whom you are filing
more than one Form 1098-VLI. Additionally, the IRS
encourages you to designate an account number for all
Forms 1098-VLI that you file. See part L in Pub. 1099.

Box 1. Vehicle Loan Interest Received by Lender

Enter the vehicle loan interest received from the payer
of record during the calendar year. Do not include
any prepaid interest that does not meet the exception
explained under Prepaid SPVL Interest, earlier.

Note: Do not include in box 1 any interest attributable to
the portion of indebtedness that does not qualify as an
SPVL, as explained under Specified Passenger Vehicle
Loan (SPVL), earlier.

Boxes 2a, 2b, and 2c. Year, Make, and Model
Enter the appropriate information in each box.

Box 2d. VIN

Enter the VIN of the APV for which the SPVL was made.

Box 3a. Loan Origination Date

Enter the date of the origination of the SPVL with the
original lender. If you acquired this SPVL, do not enter the
date of acquisition (see Box 3b, next).

Box 3b. Loan Acquisition Date

If you acquired the SPVL, enter the date of acquisition.
Otherwise, leave this box blank.

Box 4. Outstanding Principal

Enter the amount of outstanding principal on the SPVL
as of January 1 of the calendar year for which the form
is being filed. If you originated the SPVL in the calendar
year, enter the SPVL principal as of the date of origination.
If you acquired the SPVL in the calendar year, enter the
outstanding SPVL principal as of the date of acquisition.

Box 5. Refund of Overpaid Interest

Enter the total refund or credit of a prior year(s)
overpayment of SPVL interest. See Reimbursement of
Overpaid SPVL Interest, earlier.

Box 6. Check if original use of the vehicle began
with the payer of record

Check this box if the original use of the APV began with
the payer of record. See Original Use, earlier. Also, check
this box if the payer of record is an obligor of the SPVL by
reason of the death of a previous obligor of the SPVL. See
Change in obligor, earlier.

Box 7. Check if final assembly of the vehicle
occurred within the United States.

Check this box if the final assembly of the vehicle
occurred within the United States. See Final Assembly in
the United States, earlier.

Instructions for Form 1098-VLI (12-2026)

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1098-VLI to report the reimbursement because you are
the one making the reimbursement.
Example. In the previous year, you received $5,000 of
SPVL interest from the borrower and reported that amount
on Form 1098-VLI for the previous year. In the current
year, you determined that interest due on the SPVL for the
previous year was $4,500 and the borrower had overpaid
$500. You refunded the $500 overpayment to the borrower
in the current year. If you received $600 or more of interest
on the SPVL from the borrower in the current year, you
must report the $500 refund in box 5 of the current year
Form 1098-VLI. No change to the previous year Form
1098-VLI is required. If, instead of refunding the $500
overpayment, you credited the borrower’s current year
SPVL interest payments due, $500 is still shown in box 5,
and the interest received from the borrower in the current
year shown in box 1 must include the $500 credit.