Thanks to the Tax Relief and Health Care Act of 2006, there's a new tax break available if you're a homeowner who itemizes: the private mortgage insurance deduction.What it means to you.
You could reap additional tax savings when you buy a home this year or if you refinance the mortgage you took out to purchase your home. In addition to interest and real estate taxes, the premiums you pay for mortgage insurance are now deductible.
The insurance, which protects your lender in case of default, is typically required when your down payment is less than 20% of the cost of the home.
The rules:
- Under present law, only mortgage insurance contracts issued in and allocable to 2007 qualify for the tax break. Premiums on mortgages you took out in prior years aren't eligible.
- The mortgage must be secured by your home and the home must be a qualified residence.
- Mortgage insurance premiums that you pay in advance may be nondeductible.
- You can generally claim a deduction for the full amount of qualified premiums when your adjusted gross income is less than $100,000 (married filing jointly). A limited deduction is available if your income is between $100,000 and $110,000.
Please give us a call to discuss the tax advantages of your home financing options. We can run the numbers and help you select the mortgage best suited to your situation.
Questions for our Financial Expert?
E-Mail us at: finance@ClevelandSeniors.Com
Top of Page
Back to Tax Tips of the Week
Home
What's New
Legal & Financial
