Qualified Mortgage Insurance Premiums

[Black Bart]

Can't quite get it through my head what does qualify for this Schedule A (line 13) deduction. Is it insurance on your mortgage loan if you bought (or refinanced?) your house in 2007 or later?

Client has a 1098 with a figure in the insurance box ($3K followed by **, but no following reference which I assume might have explained something to me.

Thanks for any enlightenment.

[veritas]

For contracts

entered after 12-31-06 mortgage insurance is deductible for acquisition debt. So a new home purchase would qualify. Subject to income limitations.

On the refinance I am of the opinion it would also be deductible but only up to the acquisition debt. This would be the amount remaining on the original loan plus any amounts used for substantial improvements.

As far as the refi wonder if congress had intended this result?

Thinking about this a little more. I think the mortgage insurance could be deductible up to the original loan balance for acquisition plus amounts borrowed subsequently for substantial improvements.

[veritas]

From Pub 530

http://www.irs.gov/publications/p530/ar02.html#en_US_publink100011895

[JG EA]

I also like the Pub 936 statement:

Form 1098. The mortgage interest statement you receive should show not only the total interest paid during the year, but also your mortgage insurance premiums paid during the year, which may qualify to be treated as deductible mortgage interest.

The "may" seems to have to do with being able to itemize. Anyway the rest under that heading is on Page 7.