Good Morning Gentle Readers,
Mortgage insurance is a racket, we all know that. But sometimes, for some borrowers paying mortgage insurance premiums means the difference between owning your own place and spindling twelve rent receipts every year.
The CONgress has taken some pity on us mortals. Subject to limits that kick in for folks whose overall income is 100k plus, it may be possible to treat mortgage insurance premiums you paid during 2007 as home mortgage interest.
The mortgage insurance must be paid in connection with home acquisition debt, the mortgage insurance contract must have been issued after 2006, and you must have paid the premiums before 2008 for coverage in effect during 2007. You can deduct mortgage insurance premiums on Schedule A (Form 1040), line 13.
In English, acquisition debt means you borrowed money to buy the house. A refi to buy a boat, pay off Junior's college, or to pay off the maxed credit cards doesn't fly.