How does the deduction apply to CMG MI’s Single Premium, in which the premium is financed and rolled into the mortgage loan amount? Can the premium be deducted in one calendar year?
This amount is deductible as a mortgage insurance premium. Generally, the provision requires that amounts paid for mortgage insurance that are properly allocable to periods after the close of the taxable year are to be treated as paid in the period to which they are allocated. Thus, single premiums must be amortized over the life of the mortgage insurance contract, and cannot be deducted in one calendar year.
