Bill > S1425

This bill proposes to create a tax deduction for private mortgage insurance premiums paid by homeowners. Specifically, it amends Massachusetts General Laws to allow taxpayers to deduct premiums paid for "qualified mortgage insurance" on their primary residence. Qualified mortgage insurance is defined as private mortgage insurance, which is insurance that protects a mortgage lender if a borrower defaults on their loan and the sale of the foreclosed property doesn't cover the outstanding loan amount. However, this deduction is subject to an income limitation: the deductible amount is reduced by 10 percent for every $1,000 that a taxpayer's adjusted gross income exceeds $100,000. Additionally, the deduction will only apply to mortgage insurance contracts issued on or after January 1, 2007.