H.R.918 - Mortgage Insurance Tax Deduction Act of 2025 (119th Congress)
Summary
H.R.918, the Mortgage Insurance Tax Deduction Act of 2025, aims to amend the Internal Revenue Code of 1986 to make permanent the deduction for mortgage insurance premiums. Currently, this deduction is subject to periodic extensions. The bill, introduced in the House of Representatives, seeks to provide long-term certainty for homeowners.
By removing the expiration date on the deduction, the bill intends to offer continuous tax relief to individuals paying mortgage insurance. This would apply to amounts paid or accrued after December 31, 2024.
The bill is straightforward, focusing solely on making the existing mortgage insurance premium deduction permanent.
Expected Effects
If enacted, H.R.918 would permanently eliminate the uncertainty surrounding the mortgage insurance premium deduction. Homeowners who pay mortgage insurance would be able to consistently deduct those premiums from their taxes.
This change would simplify tax planning for homeowners and potentially encourage homeownership. The permanence of the deduction could also have a minor impact on housing market stability.
The primary effect is a simplification and stabilization of a specific aspect of the tax code related to homeownership.
Potential Benefits
- Provides long-term tax relief to homeowners paying mortgage insurance.
- Simplifies tax planning for individuals by removing the uncertainty of the deduction's renewal.
- Potentially encourages homeownership by making it more affordable.
- Could have a minor positive impact on housing market stability.
- Reduces administrative burden on Congress by eliminating the need for periodic extensions of the deduction.
Most Benefited Areas:
Potential Disadvantages
- May slightly increase the national debt due to reduced tax revenue.
- The benefit primarily accrues to homeowners, potentially exacerbating wealth inequality.
- Could incentivize riskier lending practices if borrowers are less concerned about the cost of mortgage insurance.
- The impact on individual homeowners may be relatively small, depending on their income and mortgage insurance premiums.
- May create a sense of entitlement to the deduction, making it difficult to repeal in the future if necessary.
Most Disadvantaged Areas:
Constitutional Alignment
The bill aligns with the Constitution as it falls under the powers granted to Congress to lay and collect taxes, as outlined in Article I, Section 8, Clause 1. The bill does not infringe upon any specific rights or liberties protected by the Bill of Rights.
The act of providing a tax deduction is a policy choice within the purview of Congress's legislative authority. There is no apparent constitutional conflict.
Furthermore, the bill does not appear to violate any principles of federalism or separation of powers.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).