Achieving Homeownership with Mortgage Interest Credit

Education & Training with Alexandria Louis Tax Solutions LLC

There are so many things hidden in the fine print, but it takes someone willing to point you in the right direction for you to benefit.  As I was refreshing my knowledge on home deductions, I ran across the Mortgage Interest Credit.  In reading the details, I thought, I sure wish someone had shared this information with me when I was a struggling single parent purchasing my first home.  None the less, here is a summary of the Mortgage Interest Credit.

The Mortgage Interest Credit is a credit designed to help lower-income individuals achieve homeownership.  This credit is available to first-time homebuyers who meet the income and purchase limit requirements. To claim the credit, you must obtain a Mortgage Credit Certificate from the state or local agency prior to obtaining a mortgage to purchase the home.  In Tennessee, the agency to contact is Tennessee Housing Development Agency.  This credit allows the taxpayer to claim a dollar-for-dollar credit up to $2,000 for mortgage interest paid.  This credit is a non-refundable credit.  In other words, this credit can be used to offset tax liability but will not result in a refund in excess of the tax liability.   The excess credit can be carried forward to the next year.  The credit is claimed by completing form 8396.

Alexandria Louis Tax Solutions, LLC – A boutique tax firm in Memphis, TN

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