Good news for Borrowers who are paying mortgage insurance as part of their mortgage payment!
Borrowers with adjusted gross income of $100,000 or less may deduct 100% of their mortgage insurance premiums on their federal tax returns for the years 2018, 2019 and now 2020. Borrowers with gross earnings between $100,000 and $109,000 will have a phased-out deduction of 10% for each $1,000 of a taxpayer’s adjusted gross income that exceeds $100,000 and caps at $109,000.
In order for the mortgage insurance to be tax deductible, the property with the mortgage insurance must be a principal residence or another residence used for personal purposes, such as a second home. Non-owner-occupied mortgages with mortgage insurance do not qualify for this tax deduction.
Don’t forget that mortgage insurance paid on conventional loans can be removed after making on-time monthly payments for a minimum of 12-months if the home has appreciated in value so that you now have a minimum of 22% equity. Contact your current Servicer to request removal of the mortgage insurance you are paying.
Questions? Don’t hesitate to reach out to me, 360-459-1200.