(1) Except as provided in (2), when the deductions allowed under 15-30-2131, MCA, are limited to a percent of adjusted gross income by reference to the IRC, Montana adjusted gross income must be used when calculating the deductions limitation for the Montana return. Montana adjusted gross income is defined in 15-30-2110, MCA.

(2) Taxpayers who are allowed a deduction for mortgage insurance premiums paid under IRC, 26 U.S.C. 163, may use their federal adjusted gross income when computing the allowable amount for the Montana return.