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jgordosea
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3159
Experience:  I've prepared all types of taxes since 1987.
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I am purchasing a home and am considering paying for all of

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I am purchasing a home and am considering paying for all of my Private Mortgage Insurance (PMI) upfront at closing since it is tax deductible for 2013. It would be a one time payment of $5,500, however I make over $120,000 per year. Would I get anything back?

Greetings,

 

Unfortunately there is limitation on the deduction of PMI. For details see http://www.irs.gov/publications/p17/ch23.html#en_US_2012_publink1000296273 (which is the 2012 publication but still applies).

 

The amount of PMI allowed as a deduction is:

  • Phased out if your adjusted gross income (AGI) exceeds $100,000 for married filing joint
  • Reduced by 10% for each $1,000 over $100,000
  • Eliminated completely when your AGI exceeds $109,000 for married filing joint

So, paying the PMI will not increase your deductions if your AGI is 120,000.

 

Hope this helps to know even though it is likely not the answer you would have preferred.

 

Please ask if you need more information or discussion.

Thank you.

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