Congress Extends Tax Deductibility of Mortgage Insurance
Mortgage Insurance Premiums Remain Tax Deductible Through December 31, 2013
Washington, D.C., January 2, 2013—Congress passed the extension to continue the tax deductibility of premiums for mortgage insurance through 2013 as an amendment within The American Taxpayer Relief Act of 2012. The provision extends the ability of homeowners to deduct the premium cost of mortgage insurance on a qualified personal residence for homeowners with an adjusted gross income of under $100,000 and applies to amounts paid or accrued after December 31, 2011 and through December 31, 2013.
“MICA member companies are pleased that Congress has taken the necessary steps to enact legislation that preserves the tax deductibility of premiums for U.S. homeowners,” said Teresa Bryce Bazemore, President of the Mortgage Insurance Companies of America (MICA). “This positive development will sustain home affordability for low- and moderate- income homebuyers who are assisted by private capital, in the form of private mortgage insurance. This preservation of tax policy parity is essential for the continued recovery of the residential housing market.”
The bill provides for the extension of tax deductibility for mortgage insurance premiums for eligible borrowers for their personal residences. The deduction is phased out by 10 percent for each $1,000 when the homeowner’s adjusted gross income exceeds $100,000 and thereby is not available to homeowners with incomes in excess of $110,000.
Ms. Bryce Bazemore noted that “recognition of the value of private mortgage insurance to borrowers and to the housing market helps assure that the industry has and will continue to play a key role in a revitalized housing market as first time and low- to moderate-income families increasingly rely on private sector capital to access residential mortgage loans.”
Founded in 1973, the Mortgage Insurance Companies of America (MICA) is the national trade association representing member private mortgage insurance companies. MICA member companies are Genworth Mortgage Insurance Corporation, Mortgage Guaranty Insurance Corporation, and Radian Guaranty Inc.
MICA members expand homeownership opportunities to purchase or refinance homes with low down payment mortgages, which allow the borrower to make a down payment of less than the traditional 20 percent of the house purchase price and as low as a 5 percent down payment. For more information, visit: www.privatemi.com.