The VA Funding Fee Is Tax-Deductible Again in 2026. Here's How to Claim It.
The VA funding fee is tax-deductible again in 2026! Learn the new IRS Schedule A rules, income phase-out limits, and how to claim your deduction.
Every year, thousands of borrowers pay the VA funding fee and never claim a single dollar back at tax time. It's one of the most overlooked tax deductions in military homebuying, and in 2026, it's back on the table after years of uncertainty. Here's what you need to know about the VA funding fee tax deduction for 2026, including what changed, who qualifies, how to claim it, and what to watch out for when you file.
Yes. The VA funding fee on a VA loan is tax-deductible in 2026 for eligible homeowners who itemize their deductions on Schedule A of Form 1040.
The deduction applies because the VA funding fee is classified as a mortgage insurance premium (MIP), the same category as private mortgage insurance (PMI) and FHA mortgage insurance. Under IRS rules, qualifying mortgage insurance premiums paid on your primary or secondary residence can be deducted as mortgage interest when you itemize.
