Congress locks in homeowner tax break, making mortgage insurance deduction permanent.
H.R. 918 — Mortgage Insurance Tax Deduction Act of 2025 · Filed by Julia Brownley (D-CA) · Introduced Feb 4, 2025 · Referred to committee
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What it does
This bill makes permanent a tax deduction for mortgage insurance premiums that was previously set to expire. Homeowners who pay mortgage insurance (required when putting down less than 20% on a home purchase) can currently deduct those premiums from their taxable income, but that deduction was scheduled to end. This bill removes the expiration date, allowing the deduction to continue indefinitely. Homeowners with mortgages requiring insurance premiums benefit by keeping this tax break.
Why we flagged it
The bill's sole function is to extend an existing homeowner tax benefit by removing its sunset clause. It is a straightforward tax-code amendment with no secondary mechanisms or riders.
What the text implies
- Permanence removes the periodic legislative pressure to renew the deduction, shifting the burden to opponents to affirmatively repeal it rather than allowing it to lapse.
- The deduction's value is regressive: it benefits higher-income homeowners more (in absolute dollars) because they pay higher mortgage insurance premiums and face higher marginal tax rates.
The full analysis lists 3 implications of this text.
Who stands to gain
homeowners with mortgages requiring insurance; mortgage lenders (indirectly, through increased demand for mortgaged properties); mortgage insurance companies (indirectly, through sustained demand)