Can someone please clarify or give a citation on how much of a PMI premium is required to include in the APR calculation. Should this be 1 month or the entire premium for the year?

Any premium you collect for deposit into an escrow account, and if you are still on a yearly premium the first year's premium collected at closing would be included as prepaid finance charges. If you are on monthly premiums then only premiums collected to be deposited in the escrow account would be prepaid finance charges.

As a result of the Homeowners' Protection Act, you are not allowed to continue collecting MI premiums after the termination date. Accordingly, you include in the APR and FC all prepaid and renewal premiums before the termination date and none afterwards.