FHA MIP is charged as a fixed amount based upon the amount of the loan. You can either pay it in full in cash at settlement or roll it into the loan proceeds. HOWEVER you may ONLY deduct the portion of the MIP that applies to 2007 and ONLY if the loan is a purchase money mortgage taken out after Dec 31, 2006. If it was a purchase money mortgage taken out prior to 2007 OR if it was a re-fi then it's not deductible.
So, if this was a purchase money mortgage that you took out in 2007 then you may deduct 1/30 of the MIP that you paid, prorated for the number of days remaining in 2007 after the closing date, as an itemized deduction on line 13 of Schedule A on your 2007 tax return. For example, if your MIP premium was $3,000 and you closed on May 15th you may deduct 224 days worth of 1/30 of $3,000 ($100) or $61.