First time home buyers can claim up to *20% or 30% of the mortgage interest paid each year as a tax credit with a mortgage credit certificate.
*30% only available for City and County of Denver
Still allowing the remaining mortgage interest, property taxes, and mortgage insurance to be a tax deduction.
MCC's are available in ALL counties of Colorado.
How does the MCC work?
For the life of the loan, MCC holders can claim a dollar-for-dollar credit towards your tax liability. This reduces the amount of federal taxes owed.
By changing your payroll withholdings, increasing your take home pay, buying a home can be much more affordable!
$150,000 at 5.5% fixed rate = $8,200 approx. in interest payments.
With a MCC 20% of $8,200 = $1,640 of the interest payments would be allowed to be taken as a tax credit toward the your federal income tax liability.
This would effectively add into your monthly income $136.67 ($1640 / 12 months = $136.67) when you change your withholdings through work.
If you have any questions or would like to find out more contact us!