On December 18, 2015, the President signed legislation that renews the tax deductibility of mortgage insurance (MI) premiums for qualified borrowers through 2016.
Minneapolis, MN: The deductibility is effective for purchase and refinance transactions closed after December 31, 2014. MI premiums paid or accrued after December 31, 2014 and through December 31, 2016 may qualify for tax deductibility on borrwers' subsequent federal tax returns as follows:
- Borrowers with adjusted gross incomes below $100,000 may deduct 100% of their MI premiums.
- For borrowers with adjusted gross incomes from $100,000.01 to $110,000, deductions are phased out at 10% increments for each additional $1,000 of adjusted gross household income.
Mortgage insurance is always been the necessary evil of home buyer. If you don't put down at least 20%, you need to deal with it somehow.
A good Mortgage Loan Officer will be able to go over all your Loan Options, including how mortgage insurance works, how much it costs, alternative options like lender paid mortgage insurance, up-front single premium, and more... This even includes why it isn't anywhere nears as bad as many people think... and of course, how it is tax deductible for many people.
Joe Metzler is a Senior Mortgage Loan Officer for Minnesota based Mortgages Unlimited. He was named the 2014 Minnesota Loan Officer of the Year, and #98 of the Top 100 Loan Officers in the Nation for 2015 by Origination News. He provides Home Mortgage Loans in MN, WI, and SD. He can be reached at (651) 552-3681