MI Bill Tied to Crucial Tax Legislation

Senate leaders have reportedly agreed to attach a mortgage insurance deduction bill to must-pass tax legislation dealing with export subsidies.Sen. Gordon Smith, R-Ore., has secured a commitment to include his bill (S. 846) in the foreign sales corporation/extraterritorial income bill, Mortgage Wire has learned. The senator's press secretary could not be reached to confirm the agreement. Sen. Smith's bill is designed to lower the cost of buying a home for families who cannot come up with a large downpayment and have to purchase mortgage insurance. S. 846 would allow homebuyers with incomes below $100,000 to deduct 100% of the mortgage insurance premiums from their taxes. Senate leaders are hoping to pass the FSC-ETI bill in March, but it is a controversial measure that is getting embroiled in issues such as overtime pay rules and the outsourcing of jobs to foreign countries. The House tax-writing panel has been unable to agree on an FSC-ETI bill.