Homeowners insurance premiums aren’t tax deductible. Period. The IRS treats them as personal expenses, right alongside groceries and Netflix subscriptions. That goes for fire insurance, extensive coverage, and title insurance too. No itemized deductions exist for this stuff, and recent tax legislation hasn’t changed a thing. Mortgage insurance premiums, however, became permanently deductible in 2026 under the One Big Beautiful Bill Act. There are other homeowner tax breaks worth knowing about, including deductions for mortgage interest and property taxes.
Design Highlights
- Homeowners insurance premiums are not tax deductible and are classified by the IRS as personal expenses.
- Mortgage insurance premiums became permanently tax deductible in 2026 under the One Big Beautiful Bill Act.
- The mortgage insurance deduction phases out starting at $100,000 adjusted gross income, ending completely at $110,000.
- Mortgage interest and property taxes remain deductible, with property tax deductions capped at $10,000 for some filers.
- The proposed 2025 Homeowners Premium Tax Reduction Act could allow a $10,000 homeowners insurance deduction if passed.
The short answer? No. Homeowners insurance premiums are not tax deductible. The IRS considers them personal expenses, plain and simple. Fire insurance, extensive coverage, title insurance—none of it counts.
Homeowners insurance premiums remain personal expenses in the eyes of the IRS—no deductions, no exceptions, no tax breaks.
These premiums don’t qualify for itemized deductions on your federal tax return, and no recent tax legislation has changed that. You still need to keep records for insurance claims, but don’t expect any tax advantages.
Here’s where it gets interesting. Mortgage insurance premiums are a different beast entirely. The One Big Beautiful Bill Act, signed in 2025, made mortgage insurance premiums permanently tax deductible starting in 2026.
Before this, the deduction kept expiring after 2021 and needed annual renewal like some kind of bureaucratic subscription service. Between 2007 and 2021, taxpayers deducted mortgage insurance premiums over 44 million times, totaling $64.7 billion. The average deduction hovered around $1,454 annually, jumping to $2,364 in 2021 for those who qualified. Low- and moderate-income homeowners benefited most.
There’s a catch, naturally. The deduction phases out once your adjusted gross income hits $100,000, or $50,000 if you’re married filing separately. Complete phaseout happens at $110,000.
Homeowners do get other tax breaks. Mortgage interest remains deductible, with a limit of $750,000 in mortgage debt for loans taken between December 15, 2017, and January 1, 2026. Property taxes are deductible up to $10,000 for married couples filing jointly or single filers. Energy-related improvements also qualify.
Home repairs and maintenance? Forget it. Explicitly non-deductible.
The State and Local Tax deduction cap increased to $40,000 for married couples filing jointly for tax years 2025 through 2029. Single filers get $20,000.
Income phaseouts kick in above $500,000 in modified adjusted gross income, eventually dropping back to the $10,000 floor. The phaseout reduces your allowable SALT deduction by 30% of MAGI over the applicable threshold. Homeowners’ association fees still don’t count. Itemized deductions lower taxable income, so keep detailed records of all deductible expenses in case the IRS comes knocking during an audit.
One potential game-changer sits in legislative limbo. A 2025 bill called the Homeowners Premium Tax Reduction Act proposes an above-the-line deduction of up to $10,000 for annual homeowners insurance premiums.
It’s not law yet as of late 2025. If it passes, it would flip the script entirely on how homeowners insurance premiums get treated at tax time. The national average premium currently stands at around $2,424 to $2,470 annually for typical dwelling coverage, though costs vary widely by state and have risen 24% from 2021 to 2024. Until then, those premiums remain firmly in the non-deductible category.
Frequently Asked Questions
Can I Deduct Mortgage Insurance Premiums on My Taxes?
Mortgage insurance premiums aren’t deductible for 2025 tax filings—that benefit died after 2021.
But here’s the twist: it’s coming back permanently for tax year 2026 and beyond, thanks to legislation passed in mid-2025.
When it returns, taxpayers who itemize can deduct PMI and government-backed mortgage insurance premiums, but only if their adjusted gross income stays under $100,000.
Above that threshold, the deduction phases out.
No itemizing? No deduction.
Are Home Warranty Plans Tax Deductible for Homeowners?
Home warranty plans aren’t tax-deductible for primary residences.
The IRS lumps them in with personal expenses, so those monthly premiums and service call deductibles don’t count come tax time. That’s just how it is.
But there’s a workaround.
Homeowners with dedicated home offices can deduct a portion based on square footage.
Rental property owners get to write off warranty costs as operating expenses.
Business-related coverage might qualify for partial deductions too.
The rules change depending on how the home’s actually used.
What Records Should I Keep for Insurance-Related Tax Deductions?
Homeowners need to keep premium payment receipts, insurance policy documents, and proof of percentage used for rental or business purposes. That means tracking square footage, saving lease agreements, and documenting rental income on Schedule E.
For disaster claims, preserve all correspondence with insurers, receipts for out-of-pocket repairs, and proof of denied claims. Store everything for three to seven years—both digital and physical copies.
The IRS isn’t messing around when it comes to documentation.
Do Renters Insurance Premiums Qualify for Any Tax Deductions?
Renters insurance premiums are generally not tax deductible. They’re considered personal expenses, plain and simple.
However, there’s an exception: if someone uses part of their rental exclusively and regularly as a home office for business, they might deduct the portion of premiums covering that space.
The IRS is strict about this—the area must be dedicated solely to business, not mixed use. Most renters won’t qualify.
It’s a narrow exception to an otherwise firm rule.
Can I Deduct Earthquake or Flood Insurance Premiums?
No tax deduction for earthquake or flood insurance on a primary residence. Period.
But rental property owners? Different story. They can deduct those premiums as business expenses—only for the rental portion, though. Federal rules don’t budge on personal property. State rules typically follow suit.
Here’s the kicker: even though deductibles on these policies run high (think 10-20% for earthquakes), those out-of-pocket costs might qualify as casualty losses if there’s a federally declared disaster.
