The MCC program is designed to help offset a portion of the mortgage interest, and to help qualify for a loan. Because it’s a tax credit and not a tax deduction, mortgage lenders will often incorporate the estimated amount of the credit (prorated on a monthly basis) as additional income to help the potential borrower qualify for the loan. Amounts vary by state, but you can get back 20% to 40% of the interest you pay as a tax credit. There are minimum guidelines that must be met. Buyers must: not have lived in a home that they owned in the previous three years, meet income and purchase price restrictions and intend to use the new home as a primary residence. To qualify for this tax credit, you’ll need an MCC issued by the local government, which your loan officer may or may not know how to do. For more information, visit www.irs.gov. • Home improvements. Improving your home will not only add to its livability and comfort, it could also earn you tax deductions in multiple ways. You can use a home improvement loan to finance the cost of improvements on your primary or secondary home, which will then likely qualify you for mortgage interest deductions. The interest on a home improvement loan is deductible in full, up to a sum of $100,000 in debt. • Home office deduction. If you are self-employed and work from home, the amount of space in your home that’s dedicated towards business activities can be tax deductible. This deduction can include loan interest, insurance payments, utilities, repairs, and more. However, with the Tax Cuts and Jobs Act (TCJA) that is in effect for 2018 – 2025 only, people who are filing as
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