Thursday, January 6, 2011

Federal Government Extends Deduction of Mortgage Insurance

Just another example of how the Federal Government is trying to entice more people to buy homes by extending tax incentives.

Federal Government has extended the mortgage insurance (MI) tax deductibility to 2011.

Here is a quick breakdown of what it is, how much the average home owner can expect, and how long it will be extended for:

  • The law provides for an itemized deduction on federal tax returns for the cost of private mortgage insurance paid by eligible borrowers.
  • The law allows qualified borrowers with adjusted gross income of up to $100K to deduct 100% of their MI premiums on the federal tax returns.
  • According to an analysis by Bankrate, a leading source of consumer financial information, a homeowner with a $180,000 mortgage would save about $351 in taxes a year.
  • This law applies from 2007 – 2011 and may be extended if congress chooses to do so.
Click here for more information on mortgage insurance deductions

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