"Mortgage Interest Credit (MIC)"

What is it, How it works, Eligibility, Limits, Calculator, Example, Form & How to Claim ?

What is Mortgage Interest Credit ?

Mortgage Interest Credit is a tax credit provided by the Internal Revenue Service in the US. It is designed for lower- to moderate-income earners to help them afford homeownership.

How Mortgage Interest Credit Works ?

Mortgage Interest Credit is a tax credit that allows eligible individuals to reduce their federal income tax liability based on the mortgage interest they pay on their home loans. 

Who Qualifies for Mortgage Interest Credit ?

Individuals who meet the income and property eligibility requirements, and who have been issued a qualified Mortgage Credit Certificate (MCC) by a state or local government agency.

How Much is Mortgage Interest Credit ?

The credit is based on a percentage of the mortgage interest paid on the qualified home loan during the tax year. The IRS limits the mortgage interest credit to a maximum of $2,000 per year.

Benefits of Mortgage Interest Credit

Credit provides homeowners with a reduction in overall tax liability by allowing them to claim a credit based on a percentage of the mortgage interest paid on their primary residence.

How to Calculate Mortgage Interest Credit ?

To calculate credit, multiply the qualified mortgage interest paid during the tax year by the applicable percentage specified in IRS Form 8396 and subtract any disallowed amounts.

How to Claim Mortgage Interest Credit ?

check requirements

To claim the Mortgage Interest Credit, eligible individuals must file IRS Form 8396 along with their annual tax return. The credit is non-refundable.