The recently signed Consolidated Appropriations Act 2021 includes a one-year extension of the mortgage insurance premium deduction as qualified residence interest paid or accrued through December 31, 2021.
Premiums paid or accrued after January 1, 2018, for qualified mortgage insurance in connection with acquisition indebtedness are deductible as home mortgage interest (qualified residence interest). The deduction is subject to the taxpayers adjusted gross income (AGI) limits. The deduction for mortgage insurance premiums applies to premiums on mortgage insurance provided by the Department of Veterans Affairs, the Federal Housing Administration, the Rural Housing Service, and private insurers.
The deduction was due to expire at the end of 2020 and has been extended for premiums paid or accrued through December 31, 2021.
Please contact the Crosslin tax team at (615) 320-5500 with any questions you may have. We are here to help!