Own a home? The One Big Beautiful Bill might give you new tax deductions.

Homeowners who have been taking the standard deduction in recent years might want to reconsider itemizing this year.

The One Big Beautiful Bill Act comes with a slew of updates affecting U.S. homeowners. The new law permanently extends a $750,000 mortgage amount limit that’s eligible for the mortgage interest deduction and reinstates a provision allowing mortgage insurance premiums, which millions of homeowners pay annually, to be deducted as interest. The state and local tax deduction, known as SALT, quadrupled, which can be particularly helpful for owners in states with high property taxes.

Those factors combined likely mean itemizing makes sense for a larger set of homeowners than before.

“There are tipping points,” Faith Bynum, a certified public accountant in Raleigh, N.C., told Yahoo Finance. “If [clients] have mortgage insurance premiums that they’re paying, it can really take them over the threshold to itemizing.”

Learn more: Standard deduction vs. itemizing: Which tax filing approach is right for you?

The 2017 Tax Cuts and Jobs Act cut the mortgage amount eligible for interest deduction to $750,000 from $1 million. The OBBB made that cut permanent. The deduction can be applied to mortgage interest paid on a first or second home.

So if you’re paying interest on an $800,000 mortgage, only the interest on the first $750,000 is deductible.

It’s a below-the-line deduction, meaning you must itemize — not claim the standard deduction — to take advantage of this tax break. Your interest rate will be a key factor. If you and your spouse bought a home in early 2025 for $400,000 with a rate of 6.5%, you paid nearly $20,000 in interest last year.

The standard deduction for joint filers on 2025 taxes is $31,500 — still far more than the amount of the mortgage interest deduction in our example. But combined with other deductions, like charitable contributions and unreimbursed medical expenses, the math could tip toward itemizing.

Read more: Mortgage interest tax deduction: How it works and when it makes sense

Most homeowners who put less than 20% down on their homes pay mortgage insurance until they reach the 20% equity threshold. Some with government-insured mortgages, like FHA loans, must carry it for the life of their loan. Costs vary based on loan type and credit score but are usually between 0.2% and 2% of a mortgage annually. That means on a $300,000 mortgage, premiums would cost anywhere from $600 to $6,000.

Mortgage insurance premiums were previously deductible between 2007 and 2021. U.S. Mortgage Insurers, a trade group for the industry, estimated that 4 million homeowners claimed the deduction each year, averaging $1,454 per taxpayer.

Under the OBBB, mortgage insurance premiums are once again deductible, adding more to a homeowner’s tax savings.

Read more: What is mortgage insurance, and how does it work?

The new tax law delivered a big tax break to homeowners, especially those in high-tax states, as the state and local tax (SALT) deduction cap jumps to $40,000 from the previous $10,000 limit.

The SALT deduction lets you deduct a variety of non-federal taxes you paid, including state and local income taxes, property taxes, local taxes (such as city income taxes or vehicle taxes), and sales taxes if your state has no income tax.

To claim the deduction, you’ll need to total up your property taxes, state income (or sales) taxes, and your personal property taxes on Schedule A. It’s also only available if you itemize.

The biggest beneficiaries tend to be middle- to high-income households in states with high income tax, though the deduction phases out once your income reaches $500,000. An analysis from the Tax Foundation found the deduction was most beneficial for homeowners in states such as California, New York, and Connecticut, where combined state income and property taxes often exceed the old $10,000 cap.

Families in the $400,000 to $500,000 income range are likely to see the largest relative reductions in their federal tax bills, according to the Committee for a Responsible Federal Budget.

Read more: What to know about the new (higher) SALT deduction — and how to claim it

Ultimately, the strategies that make the most sense vary depending on the size of your mortgage and other financial factors, Bynum said. She noted that many people still benefit from the boosted standard deduction, which was also extended permanently as part of the new law.

Those who bought homes in recent years typically have higher mortgage rates — they’ve averaged around 6.69% in the last two years, according to Freddie Mac data. And you pay more in interest in the first years of a mortgage. All that can make the mortgage interest deduction worth considering.

Let’s return to the previous example of homeowners who bought last year and paid $20,000 in mortgage interest. If they also paid for mortgage insurance at 1% of their mortgage amount, that adds another $4,000 they could deduct. And if that home was in California or another high-tax state, they could easily surpass the standard deduction amount and realize greater tax savings by itemizing.

“I think this is a year where a lot of people will want to have a conversation with their tax providers,” Bynum said.