Deducting UFMIP Owner Occupied Rental

Forum|Forum|2 years ago
February 2, 2024
1 reply
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What would be the correct process to deduct the ufmip paid at closing for an fha loan on a 2 unit property that I live in? If I were to rent out the current unit I am occupying in the future would I be able to deduct the other 50% of the ufmip paid at closing at that time? The UFMIP was rolled into the loan if that matters.

Thank you

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PatriciaV

Employee

The itemized deduction for mortgage insurance premiums has expired. The deduction doesn't exist for premiums paid after December 31, 2021.

See IRS Pub 530 Mortgage insurance premiums.

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bjf540Author

That is correct for my personal, but for the rental side this should be deductible on my schedule E?

PatriciaV

Employee

Yes, according to the IRS FAQ Rental Expenses 1, you should report the rental portion of the UFMIP on Line 9 of Schedule E.

"In general, you can deduct mortgage insurance premiums in the year paid. However, if you prepay the premiums for more than one year in advance, for each year of coverage you can deduct only the part of the premium payment that will apply to that year. Report the deduction on line 9 of Schedule E (Form 1040), Supplemental Income and Loss."

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