Mortgage Insurance Premium Deduction is Extended Through 2013

Due to the American Tax Relief Act of 2012 (ATRA), the mortgage insurance premium deduction has been extended through the end of 2013. This means homeowners may deduct premiums for mortgage insurance from their taxes for the years 2012 and 2013.

To qualify, the insurance policy must be for home acquisition debt (a mortgage taken out to buy, build, or substantially improve) on a first or second home. If the second home is rented out for part of the year, you must also use it as a home during the year for it to be a qualified home. You must use the home more than 14 days or more than 10% of the days that the home was rented out during the year at fair rental, whichever is longer.

Homeowners who are single or married, filing jointly, with adjusted gross incomes of $100,000 or less can write off 100% of their annual mortgage insurance premiums. Those who are married, filing separately can write of 50% of the premiums.