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There is currently no funding available for new Mortgage Credit Certificates, please see re-issuance instructions for existing borrowers with a Mortgage Credit Certificate.
The Mortgage Credit Certificate (MCC) program allows buyers to save up to $2,000 on their federal taxes, every year for the life of their mortgage.
The program awards a tax credit valued at 50% of the annual mortgage interest paid and is available annually as long as the home remains the home buyer’s primary residence. Homeowners are encouraged to consult a tax professional to calculate their credit through the Mortgage Credit Certificate.
Example: A home buyer qualifies for a mortgage loan of $100,000 at a fixed interest rate of 4.0%. Interest paid in year 1 = $3,968, x50%, year 1 credit
= $1,984.
Homeowners are encouraged to consult a tax professional to calculate their credit through the Mortgage Credit Certificate.
The MCC may be reissued upon refinance and may be transferable upon sale under certain conditions if reissued by IFA in accordance with program requirement.
Borrowers who buy their homes using the Mortgage Credit Certificate Program may be subject to recapture tax.
Borrowers repay the government a portion of their gain on the sale of their home, depending on (1) whether there is a gain on the sale, (2) the household income at the time of sale, and (3) if the sale occurs within nine years of buying the home. Recapture Tax is paid directly to the IRS when filing taxes for the year in which the home is sold.
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