New Tax Law Changes for 2007-Mortgage Insurance Premiums are deductible!
Mortgage Insurance Premiums Treated as Home Mortgage Interest
The IRS has announced that the "premiums that are paid for or accrued for qualified mortgage insurance during the tax year 2007 in connection with home acquisition debt on a qualified home are deductible as home mortgage interest."
There are some limitations imposed on the amount of Mortgage Insurance Premiums that can be treated as Home mortgage Interest. These are based on both the taxpayer's filing status and adjusted gross income.
For Married Filing Joint (MFJ)Taxpayers
The IRS has stated that the amount a MFJ taxpayer may treat as home mortgage interest deduction is reduced by 10% (.10) for every $1,000 by which the adjusted gross income exceeds $100,000."
For Married Filing Separately (MFS)Taxpayers
The IRS has stated that the amount a MFS taxpayer may treat as home mortage interest deduction is reduced by 10% (.10) for every $500 if by which the adjusted gross income exceeds $50,000.
For more details on this subject, please refer to IRS Publication 936.