USMI submitted a letter for the record for the U.S. Senate Committee on Finance’s March 7 hearing titled, “Tax Policy’s Role in Increasing Affordable Housing Supply for Working Families.” USMI has long supported the tax provision allowing a deduction for MI premiums paid in connection with a mortgage on a qualified residence and commends the bipartisan work on the Middle Class Mortgage Insurance Premium Act to make the deduction permanent and expand taxpayer eligibility. Since 2007, the MI deduction has been a powerful tool in prudently promoting homeownership for low- and moderate-income (LMI) families and has been claimed over 43 million times by qualified homeowners for an aggregate $61.6 billion in tax deductions. Click here to read the letter.
WASHINGTON—Seth Appleton, President of U.S. Mortgage Insurers (USMI), released the following statement on the introduction of The Middle-Class Mortgage Insurance (MI) Premium Act of 2023 sponsored by Representatives Vern Buchanan (R-FL) and Jimmy Panetta (D-CA):
“We are grateful to Representatives Buchanan and Panetta for their continued leadership on this critical legislation that would make permanent the ability of middle-class homeowners to deduct private and government MI premiums on their individual federal income tax returns, importantly restoring parity with the deductibility of mortgage interest. Since 2007, millions of homeowners have been able to claim the MI tax deduction, allowing them to save more of their hard-earned dollars. The MI tax deduction has long enjoyed bipartisan, industry, and consumer advocate support. We urge swift passage by the House and Senate.
“As affordability remains a persistent barrier to homeownership across the country, particularly for first-time homebuyers, the need for this legislation is even more urgent today than when the deduction was first enacted. Low down payment mortgages, including conventional loans with private MI, have proven critical for millions of low- and moderate-income, first-time, and minority borrowers to sustainably buy a home sooner, secure financial stability, and build intergenerational wealth.”
Borrower-paid MI premiums became tax deductible in 2007, but the deduction expired after tax year 2021. Last November, USMI joined a coalition of housing organizations in sending a letter to the House Ways and Means Committee and Senate Finance Committee urging members to make the MI premium tax deduction permanent and increase its income phaseout. Data through tax year 2020 shows that an average of 3.3 million homeowners have claimed the deduction annually and received an average deduction of $1,427. In aggregate, homeowners claimed more than $61 billion in MI premium deductions between 2007 and 2020.
U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.