And there’s more good news—the National Association of Home Builders estimates that deducting Mortgage Insurance (MI) premiums will save homeowners more than $1.3 billion a year.
During 2016, home buyers who use mortgage insurance for flexibility and lower down payments will also gain additional purchasing power through the extension of tax deductibility of MI premiums! Other benefits include:
- A lower cost of home ownership (including refinancing).
- Clear tax deductibility rules for borrowers planning to buy a house during 2016.
- Current eligible homeowners may deduct MI premiums paid during 2015 on their upcoming tax return.
MI Premium Tax Deductibility
Mortgage insurance premiums may be tax deductible for those who bought or refinanced a home on or after January 1, 2007. The MI tax deduction delivers the biggest benefit to borrowers who itemize their federal tax returns. Eligibility requirements include:
- Homeowners with an Adjusted Gross Income (AGI) below $100,000 per year (or $50,000 for those married filing singly) may deduct 100% of their annual mortgage insurance premiums.
- Households with incomes over $100,000 and up to $109,000 are eligible for a reduced deduction.
- The property must be a principal residence of the taxpayer or another residence that is used for personal purposes by the taxpayer.
- Investor loans are not eligible.
We do not provide tax advice. Please consult your financial advisor for more information.
if you would like more information, please visit this Deduct Your MI Premium which links to IRS Publication 936