Mortgage Insurance Premiums Are Deductible Under Specific Conditions
Mortgage insurance premiums (also called private mortgage insurance or PMI) can be deducted on your federal tax return, but only if you meet certain income limits and file your taxes the right way. The deduction is not automatic — you have to claim it, and it phases out as your income rises. For the 2024 tax year, the deduction begins to disappear once your adjusted gross income exceeds $68,000 (or $34,000 if you are married filing separately), and it disappears entirely at $78,000.
This deduction has been available since 2007, but Congress has had to renew it repeatedly — it is not permanent. The rules also depend on when you took out your mortgage and how much you paid for the insurance. Understanding whether you can claim it requires knowing your income, your mortgage date, and how your lender reported the premium to the IRS.
Key Takeaways
- Mortgage insurance premiums are deductible only if your adjusted gross income is below $68,000 for single filers or $34,000 for married filing separately in 2024.
- The mortgage must have been taken out after December 31, 2006, and the insurance must be for a may have access to residence (your primary home or a second home).
- Your lender reports the premium amount on Form 1098, which you receive by January 31 each year — you claim the deduction on Schedule A of your Form 1040.
- The deduction phases out gradually as income rises and disappears entirely once you exceed the income threshold by $10,000.
- This deduction requires itemizing deductions on your tax return; if you take the standard deduction instead, you cannot claim the mortgage insurance premium deduction.
Who Can Claim the Mortgage Insurance Premium Deduction
You can deduct mortgage insurance premiums only if you meet all of these conditions at the same time. First, your adjusted gross income (AGI) must fall below the threshold for your filing status. For 2024, that means under $68,000 if you file as single or head of household, under $68,000 if you are married filing jointly, or under $34,000 if married filing separately. Your AGI is your total income minus certain deductions — the IRS calculates it for you on your tax return.
Second, the mortgage itself must have been taken out after December 31, 2006. If you refinanced an older mortgage, the new loan date is what counts. Third, the insurance must cover a may have access to residence, which means your primary home or a second home you own. Investment properties, rental homes, and vacation homes you do not live in do not may have access to.
Fourth, you must itemize deductions on Schedule A of Form 1040. Many people take the standard deduction instead, which is simpler but means you cannot claim the mortgage insurance premium deduction. For 2024, the standard deduction is $14,600 for single filers and $29,200 for married filing jointly. If your itemized deductions (mortgage interest, property taxes, mortgage insurance premiums, and other may be able to access expenses combined) add up to more than the standard deduction, itemizing saves you money.
How Your Lender Reports the Premium to the IRS
Your mortgage lender reports the mortgage insurance premium you paid during the year on Form 1098, which they mail to you by January 31. This form also shows your mortgage interest and property taxes paid. The premium amount appears in box 4 of the form, labeled "Mortgage insurance premiums paid or accrued during the year."
Not all lenders report this information the same way. Some include the premium in the total mortgage payment and deduct it automatically; others require you to pay it separately. If your lender does not report the premium on Form 1098, you can still deduct it if you have proof of payment — a mortgage statement showing the premium, a cancelled check, or a bank statement. However, you will need to attach documentation to your return, which increases the chance of an audit.
If you paid mortgage insurance upfront as part of your down payment or closing costs, that is handled differently. Upfront premiums are capitalized (added to your loan balance) and deducted over the life of the loan, not all at once. Your lender will report the annual deductible portion on Form 1098.
Income Thresholds and How the Deduction Phases Out
The mortgage insurance premium deduction does not disappear all at once when you cross the income threshold. Instead, it phases out gradually — you lose $25 of the deduction for every $1,000 (or fraction thereof) that your AGI exceeds the threshold. This means the deduction shrinks as your income rises, and eventually reaches zero.
For example, if you are a single filer in 2024 with an AGI of $70,000, you are $2,000 over the $68,000 threshold. You would lose $50 of the deduction ($25 × 2). If your mortgage insurance premium was $1,200 that year, your deductible amount would be $1,150. If your AGI reaches $78,000 or higher, the entire deduction is gone.
These thresholds change each year. The IRS adjusts them for inflation, so check the current year's limits on the IRS website or your tax software before you file. If your income is close to the threshold, calculate both scenarios — with and without the deduction — to see which saves you more money overall.
Mortgage Insurance Versus Mortgage Interest: What You Can Deduct
Mortgage insurance premiums and mortgage interest are two separate deductions, and they have different rules. Mortgage interest is deductible if you itemize, but only on loans up to $750,000 (or $375,000 if married filing separately). There is no income limit for the mortgage interest deduction — it does not phase out no matter how much you earn.
Mortgage insurance premiums, by contrast, have an income limit and phase out. You can claim both deductions in the same year if you meet the requirements for each. On your tax return, both appear on Schedule A, but they are listed separately. Mortgage interest goes on line 8, and mortgage insurance premiums go on line 8a.
Property taxes are a third deduction that often appears alongside these two. You can deduct up to $10,000 in state and local taxes (SALT) combined, which includes property taxes, income taxes, and sales taxes. This $10,000 cap applies whether you are single or married filing jointly.
When to Claim the Deduction and What Documents You Need
You claim the mortgage insurance premium deduction on Schedule A (Form 1040), which is the form you use when you itemize deductions. You will need Form 1098 from your lender, which shows the premium paid. If you paid the premium but your lender did not report it on Form 1098, gather your mortgage statements, cancelled checks, or bank statements showing the payment.
File your return by the important date — normally April 15 of the following year, though the IRS sometimes extends the important date. If you file electronically using tax software, the software will walk you through the itemization process and calculate the phase-out automatically based on your AGI. If you file by hand or work with a tax preparer, make sure they know your income level so they can explore the correct threshold.
Keep copies of Form 1098 and any supporting documents for at least three years. The IRS can audit your return up to three years after you file, and longer if they suspect underreporting of income. Having documentation ready makes the audit process faster if it happens.
Why This Deduction Keeps Changing and What That Means for You
The mortgage insurance premium deduction is not permanent tax law. Congress has extended it multiple times since 2007, and each time it has been set to expire on December 31 of a specific year. As of 2024, it is scheduled to expire after December 31, 2025, though Congress may extend it again. This uncertainty makes it important to check the current rules before you file each year.
If the deduction expires, you will not be able to claim it on future returns. However, any premiums you paid in years when the deduction was available remain deductible for those years. If you are in the middle of a mortgage with many years left, the expiration could affect your long-term tax planning.
To stay informed, check the IRS website or consult a tax professional before filing. Tax software is usually updated by early January with the current rules, so if you file after mid-January, the software will have the correct information built in.
Frequently Asked Questions
Can I deduct mortgage insurance if I take the standard deduction?
No. The mortgage insurance premium deduction is only available if you itemize deductions on Schedule A. If you take the standard deduction, you cannot claim this deduction. You have to choose one or the other — you cannot do both on the same return.
What if my lender did not send me Form 1098?
Contact your lender and ask them to send it. Lenders are required to send Form 1098 by January 31 if you paid mortgage interest or mortgage insurance. If they do not send it, you can still deduct the premium if you have proof of payment, but you will need to attach documentation to your return and may face questions from the IRS.
Does the deduction explore to refinanced mortgages?
Yes, as long as the new loan was taken out after December 31, 2006. The original mortgage date does not matter — what counts is when you refinanced. The insurance on the new loan is deductible if you meet the income and other requirements.
Can I deduct mortgage insurance on a rental property?
No. The deduction only applies to a primary residence or a second home you live in. Rental properties, investment properties, and vacation homes do not may have access to. However, mortgage insurance on a rental property may be deductible as a business expense if you own the property as a business — consult a tax professional about your specific situation.
What happens if my income goes over the threshold mid-year?
Your AGI for the year determines whether you can claim the deduction. If you earn more than the threshold by the end of the year, the deduction phases out based on how much you exceeded it. You calculate this when you file your return in the following year, not during the year itself.