November 20th, 2009 | 
Author: There was also a small bit of good news for homeowners with private mortgage insurance (PMI): Congress voted to extend the deductibility of PMI premiums until Jan. 1, 2010.
WHAT DOES THIS MEAN BECAUSE I DO PAY A PMI ON MY MORGTGAGE??/ SOMEONE PLEASE EXPLAIN THIS TO ME???
The change is actually an extension. In late 2006 Congress passed a law allowing a rather strange one-year deduction of premiums for private mortgage Insurance (PMI). This was a scrap thrown to PMI insurers who had been complaining that their businesses were suffering from the number of homeowners opting for piggyback mortgages. These simultaneous second mortgages were used for a house down payment, eliminating the need for PMI and providing an additional mortgage interest deduction.
This deduction required that the policy be taken out and paid for in 2006 (tough luck for homeowners struggling with premiums from earlier years,) was for home acquisition not refinancing, and the deduction was available for 2006 only. Now this deduction has been extended for 2007 provided that the PMI contract was entered into in 2006 or 2007 and that payments for the more recent year were made before 2008. PMI premiums are treated as mortgage interest on Schedule A so taxpayers must itemize in order to claim the deduction and the taxpayer’s gross income must be under $50,000 for an individual or $100,000 for a couple filing jointly. A portion of this deduction may be available for higher earners; again, consult the regulations or your tax advisor.
Posted in Insurance News
that means you can continue to deduct your pmi until 2010.
References :
Consult your accountant for how this specifically affects you.
Based on this small blurb, it means that the amount you pay in PMI is tax deductible. So if you pay $20/mo, you can take a deduction of $240 on next year’s taxes.
References :
If you itemize your taxes, you claim deductions for real estate taxes paid, mortgage interest, and also the PMI . New law.
References :
You get to deduct the PMI you paid on your mortgage on your 2007 tax return. The amount you paid in shoudl be listed on your year end tax statment. If you use Turbo Tax it asks you straight away if you paid any PMI and it does the work for you. I have used Turbo Tax for so long that I don’t know what form it would go on or anything…but you do get to deduct it on your taxes.
References :
The change is actually an extension. In late 2006 Congress passed a law allowing a rather strange one-year deduction of premiums for private mortgage insurance (PMI). This was a scrap thrown to PMI insurers who had been complaining that their businesses were suffering from the number of homeowners opting for piggyback mortgages. These simultaneous second mortgages were used for a house down payment, eliminating the need for PMI and providing an additional mortgage interest deduction.
This deduction required that the policy be taken out and paid for in 2006 (tough luck for homeowners struggling with premiums from earlier years,) was for home acquisition not refinancing, and the deduction was available for 2006 only. Now this deduction has been extended for 2007 provided that the PMI contract was entered into in 2006 or 2007 and that payments for the more recent year were made before 2008. PMI premiums are treated as mortgage interest on Schedule A so taxpayers must itemize in order to claim the deduction and the taxpayer’s gross income must be under $50,000 for an individual or $100,000 for a couple filing jointly. A portion of this deduction may be available for higher earners; again, consult the regulations or your tax advisor.
References :
Mortgage Broker – WeFixrates .Com