Mortgage insurance is generally not tax deductible, with one narrow exception
For most homeowners, private mortgage insurance (PMI) — the insurance you pay when your down payment is less than 20 percent — cannot be written off on your federal tax return. The IRS treats PMI as part of your mortgage payment, not as a deductible expense like property taxes or mortgage interest.
There is one exception: mortgage insurance premiums (MIP) on FHA loans may be deductible under specific conditions. This deduction expired at the end of 2023 and has not been extended, so it is no longer available for tax years 2024 and beyond. If you took out an FHA loan before 2024 and are still filing returns for those years, you may be able to claim the deduction retroactively, but you would need to file an amended return.
The rules around mortgage insurance and taxes are strict, and the difference between PMI and MIP matters. Understanding which type of insurance you have and what the current tax rules allow will help you avoid missing deductions you might claim or claiming ones you cannot.
Key Takeaways
- Private mortgage insurance (PMI) on conventional loans is not tax deductible under current rules.
- FHA mortgage insurance premiums (MIP) were deductible in prior years but the deduction expired on December 31, 2023, and has not been renewed.
- If you paid MIP on an FHA loan before 2024, you may file an amended return to claim the deduction for those earlier tax years.
- Mortgage interest and property taxes remain deductible, but only if you itemize deductions on Schedule A instead of taking the standard deduction.
The difference between PMI and MIP
Private mortgage insurance (PMI) is what you pay on a conventional loan when your down payment is less than 20 percent. Your lender requires it to protect themselves if you default. Once your home equity reaches 20 percent, you can request that PMI be removed, and your monthly payment drops.
Mortgage insurance premiums (MIP) are what you pay on an FHA loan. Unlike PMI, MIP does not automatically go away when you reach 20 percent equity. On most FHA loans, you pay MIP for the life of the loan, though some loans taken out after 2013 with a down payment of 10 percent or more can have MIP removed after 11 years.
The tax treatment of these two is different — or was, before the MIP deduction expired. Knowing which one you have requires looking at your loan documents or asking your lender directly. Your monthly statement will also show whether you are paying PMI or MIP.
Why PMI is not deductible
The IRS classifies PMI as a cost of borrowing, similar to origination fees or discount points. It is bundled into your mortgage payment and treated as part of the loan itself, not as a separate deductible expense. This is different from mortgage interest, which is deductible, because interest is the cost of using someone else's money. PMI is insurance against the lender's risk.
Congress has considered allowing PMI deductions in the past, and some proposals have included it, but no permanent rule has passed. PMI remains non-deductible for all tax years, including 2024 and beyond.
FHA mortgage insurance premiums and the expired deduction
From 2007 through 2023, homeowners with FHA loans could deduct MIP under certain income limits. The deduction was available only if your modified adjusted gross income (MAGI) was below a threshold that changed each year — typically between $100,000 and $110,000 for single filers and $160,000 to $170,000 for married filers filing jointly.
This deduction expired on December 31, 2023. Congress did not renew it, so it is no longer available for the 2024 tax year or any year after. If you have an FHA loan and paid MIP in 2024 or later, you cannot deduct it.
However, if you paid MIP in 2023 or earlier and did not claim the deduction at the time, you can file an amended return (Form 1040-X) for those years to claim it now. You have three years from the original filing date to amend a return and claim a deduction you missed.
What mortgage costs you can still deduct
Even though mortgage insurance is not deductible, other mortgage-related costs are. Mortgage interest on loans up to $750,000 is deductible if you itemize deductions on Schedule A. Property taxes are also deductible, though your total deduction for state and local taxes (SALT) is capped at $10,000 per year.
Points paid to lower your interest rate may be deductible in the year you pay them, or you may deduct them over the life of the loan, depending on the circumstances. Loan origination fees and appraisal fees are not deductible.
To claim any of these deductions, you must itemize on Schedule A rather than take the standard deduction. For 2024, the standard deduction is $14,600 for single filers and $29,200 for married filers filing jointly. Many homeowners find that the standard deduction is larger than their itemized deductions, so they do not benefit from deducting mortgage interest and property taxes.
How to check your loan documents
Your loan estimate and closing disclosure will state whether you have a conventional loan with PMI or an FHA loan with MIP. If you no longer have these documents, you can contact your lender or loan servicer — the company that collects your monthly payment — and ask them directly.
Your monthly mortgage statement will also show what you are paying. If the statement lists "mortgage insurance" or "MI," ask your servicer to clarify whether it is PMI or MIP. Some statements use the terms interchangeably, which can be confusing.
If you are considering refinancing or paying down your loan to remove PMI, knowing your current loan type helps you understand your options. A mortgage professional or tax preparer can also review your loan documents and advise you on what deductions explore to your situation.
Frequently Asked Questions
Can I deduct PMI if I paid it in 2023?
No. PMI has never been tax deductible, regardless of the year. Only MIP on FHA loans was deductible, and only through 2023. If you paid PMI in 2023 or any other year, you cannot deduct it.
If I paid MIP on an FHA loan in 2022, can I still claim it on my taxes?
Yes. You can file an amended return (Form 1040-X) for 2022 to claim the MIP deduction if you did not claim it when you filed originally. You have three years from the filing date to amend and claim a missed deduction. Your tax preparer or the IRS can help you determine whether you meet the income limits for that year.
Does removing PMI from my loan affect my taxes?
No. Removing PMI lowers your monthly payment, but it does not create a tax deduction or any tax consequence. Your mortgage interest and property taxes remain deductible (if you itemize), but PMI removal itself has no tax impact.
If I refinance my FHA loan to a conventional loan, can I deduct the new PMI?
No. PMI on a conventional loan is never deductible. If you refinance from an FHA loan to a conventional loan to remove MIP, you will pay PMI instead, which also cannot be deducted. The tax treatment does not change.
What if my income was above the limit in 2023 — could I not deduct MIP?
Correct. The MIP deduction had income limits that varied by year. If your MAGI exceeded the limit for 2023, you could not claim the deduction even though it was still available that year. If your income has since dropped, you cannot go back and claim it retroactively.