The Mortgage Interest Credit is a nonrefundable credit intended to help lower-income individuals own a home. A taxpayer may claim the mortgage interest credit if
- a qualified mortgage credit certificate (MCC) was issued by a state or local governmental unit or agency under a qualified mortgage credit certificate program,
- the home to which the certificate relates is the taxpayer's main home,
- the home is located in the jurisdiction of the governmental unit that issued the certificate, and
- the interest on the mortgage was not paid to a related person.
If they qualify, they can take the credit each year for part of the home mortgage interest they pay.
The credit is figured on Form 8396. To access the Mortgage Interest Credit, from the Main Menu of the tax return (Form 1040) select:
- Credits Menu
- Mortgage Interest Credit (8396)
- You will be prompted for the home's address and for information about the MCC.
- Enter the amount of mortgage interest paid. If another individual (other than the spouse on a MFJ return) held an interest in the home, enter only the taxpayer's and spouse's share of the interest.
- Enter the credit rate shown on the MCC.
- Enter credit carryforwards from prior years, if any.
Unused credit can be carried forward three years.
Note: This is a guide to entering the mortgage interest credit into the TaxSlayer Pro program. It is not intended as tax advice.