Is private mortgage insurance (PMI) tax-deductible?
Key takeaways
- The private mortgage insurance (PMI) deduction expired after the 2021 tax year.
- For eligible years, PMI was deductible only if you itemized your tax deductions.
- Most borrowers pay mortgage insurance premiums when putting down less than 20 percent on a home.
Private mortgage insurance (PMI) has been tax deductible for homeowners off and on in recent decades. PMI is required by most lenders for homeowners who make a down payment of less than 20 percent on their home and provides additional protection for the lender.
In 2019, Congress reintroduced a federal tax deduction that allowed homeowners paying PMI the ability to write off the premiums for tax years 2018, 2019, 2020 and 2021 — but only if they itemized their tax deductions. Though this deduction expired at the end of 2021, you may be able to file an amended return and claim it retroactively for these tax years.
Keep in mind: The deadline to file your 2024 taxes is April 15, 2025. If you request an extension, you have six more months, until Oct. 15, 2025, to file.
Is mortgage insurance tax-deductible?
No, private mortgage insurance isn’t tax-deductible now. The mortgage insurance deduction was only available for eligible homeowners for the 2018–2021 tax years.
“The tax deduction for private mortgage insurance expired at the end of 2021, and Congress has not extended this provision,” says Dana Ronald, the CEO of the Tax Crisis Institute, a consultancy serving California and Nevada. “This means homeowners can no longer claim a deduction for PMI premiums on their federal income taxes starting from the 2022 tax year.”
In February 2025, a new bill called the Mortgage Insurance Tax Deduction Act of 2025 was introduced to bring this tax deduction back. It must pass the House of Representatives and the Senate, and be approved by President Trump to become law.
PMI tax deduction requirements
If you were eligible for the PMI tax deduction but didn’t take it, you might be able to amend old returns to claim it. If you do, keep in mind:
- The deduction is allowed only if the mortgage on which you paid PMI was taken out on or after Jan. 1, 2007.
- A home refinanced after Jan. 1, 2007 still qualifies for PMI deduction if it was your primary residence.
- A second home might qualify for the deduction if the mortgage was taken out on or after Jan. 1, 2007, but it depends on how the home was used. PMI on a second property only qualifies if the home was used by you personally, not rented out.
There were also restrictions to PMI deductions, including:
- The mortgage insurance deduction only applied to refinanced funds up to the original loan amount, not any extra money you took out with the new loan (as in a cash-out refi).
Once again, this tax deduction is not available for the 2022 tax year or subsequent tax years.
How much can you save with the PMI tax deduction?
Homeowners typically pay between $30 and $70 a month in PMI premiums for every $100,000 of financing, according to Freddie Mac estimates. The premiums comprise part of your monthly repayments, along with the mortgage’s principal and interest. However, the size of the down payment, loan type and lender requirements can all affect your actual cost.
How much you can save depends on how much you owe and your tax bracket. Let’s say your adjusted gross income was $100,000 and you paid $120 per month in PMI premiums when the PMI tax deduction was still available. Assuming you itemize deductions and that you can fully deduct all of the premiums, you would reduce your taxable income by $1,440.
To calculate your savings, you’ll multiply your claimed deduction (amount of deduction you are able to deduct above standard deduction) by your income tax percentage: claimed deduction x tax percentage = annual tax savings.
In this case, if you were in the 20 percent bracket, your annual tax savings would be in the neighborhood of $288 annually ($1,440 X .20). Not a huge amount, but every little bit helps — especially since if you put less cash down, you might have incurred a higher interest rate on your mortgage in the first place.
PMI tax deduction FAQ
