As a veteran in Wisconsin, you may be eligible for various benefits, including the Mortgage Credit Certificate (MCC) program. This program provides eligible veterans with a tax credit that can help reduce the cost of homeownership. Here’s an overview of the MCC program and including how Wisconsin veterans can qualify.
What is a Mortgage Credit Certificate?
A Mortgage Credit Certificate is a document that entitles eligible veterans to claim a tax credit on a portion of their mortgage interest payments. The MCC program is designed to help make homeownership more affordable for low- to moderate-income families, including veterans. In Wisconsin, the MCC program is administered by the Wisconsin Housing and Economic Development Authority (WHEDA).
Who Qualifies for an MCC?
To qualify for an MCC, you must be a first-time homebuyer or a veteran who has yet to own a home in the past three years. You must also meet income and purchase price limits, which vary by county. Generally, your income cannot exceed 80% of the area median income (AMI) for the county where the property is located. The home’s purchase price must also fall within certain limits, ranging from $283,348 to $421,925, depending on the county.
How Does the MCC Work?
You can claim a tax credit on some of your mortgage interest payments if you qualify for an MCC. The tax credit equals 20% of your annual mortgage interest, up to a maximum of $2,000 annually. The remaining 80% of your mortgage interest is still deductible on your federal income taxes. The tax credit can be claimed every year that you live in the home and have a mortgage.
How to Apply for an MCC
To apply for an MCC in Wisconsin, you must first find a participating lender. The lender will help you determine if you meet the eligibility requirements and assist you with the application process. You must provide income documentation, including tax returns for the past two years. The lender will also order an appraisal of the property to determine its value.
Benefits of an MCC for Wisconsin Veterans
The MCC program provides a range of benefits for Wisconsin veterans, including:
- Increased Affordability: By reducing the cost of homeownership, the MCC program can help make homeownership more affordable for low- to moderate-income families, including veterans.
- Tax Savings: The tax credit can help reduce your federal income tax liability, which can provide significant savings over the life of your mortgage.
- Improved Cash Flow: By reducing your monthly mortgage payment, the MCC program can improve your monthly cash flow, which can help you better manage your finances.
Conclusion
If you’re a veteran in Wisconsin and you’re looking to buy a home, the Mortgage Credit Certificate program can provide significant benefits. By working with a participating lender and meeting the eligibility requirements, you can claim a tax credit on a portion of your mortgage interest payments, which can help make homeownership more affordable. Contact a participating lender today to learn more about the MCC program and how it can benefit you.
Sources:
- Wisconsin Housing and Economic Development Authority (WHEDA). (2021). Mortgage Credit Certificate (MCC) Program. Retrieved from https://www.wheda.com/Home-Buyers/Mortgage-Credit-Certificate-Program/
- IRS. (2021). Mortgage Credit Certificates. Retrieved from https://www.irs.gov/credits-deductions/individuals/mortgage-credit-certificates
- Wisconsin Department of Veterans Affairs. (2021). Home Loans. Retrieved from https://dva.wi.gov/Pages/benefitsClaims/Home-Loans.aspx
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