MCC Tax Credit

Learn more about the MCC tax credit

Saving money on taxes feels really good. The Mortgage Credit Certificate is often overlooked, but it can help first-time homebuyers save thousands on their taxes every year.

Here’s how it works: The MCC is a special federal income tax credit that credits homebuyers 20 percent of your annual mortgage interest paid. This is different than a deduction in that it can save you significantly more. Plus, you’re still able to deduct the remaining 80 percent of annual interest paid.

The other huge benefit of the MCC is that it can actually help you qualify for a larger mortgage, since the credit can be used toward income. 

However, not every lender is approved to issue MCC certificates. Make sure your lender or bank is approved before moving forward with financing. Fortunately, the Legacy Group is experienced in guiding first-time homebuyers through the MCC process as an approved lender.

Talk to your Legacy loan officer today for more information or to get pre-approved for a smart home loan. [link]

Example of MCC tax savings:*

• Mortgage Loan Amount: $200,000
• Mortgage Interest Rate: 4.5% (4.634 APR)
• Mortgage Interest Paid in First Year: $9,000
• 20% MCC Tax Credit: $1,800 in savings.
• Monthly Mortgage Tax Credit Benefit: $150 in savings.

MCC Main Benefits:

• MCC tax credit is 20% of your annual mortgage interest paid
• You can still deduct remaining 80% of interest paid
• Increases buyer’s take-home pay with file-amended W-4
• MCC Income may be used to qualify for larger mortgage
• Valid for life of loan, as long as buyer remains in the home 

Explore your first-time homebuying options or get pre-approved today.

*This illustration is simplified for example purposes only. Actual figures, rates & APR may vary, and many other considerations may impact a person’s actual tax benefit and/or tax debt. Please consult your tax advisor.