Your Life

Your Life

Major life milestones often have a major tax impact. Changes in your marital status, having a baby or adopting a child can have significant impact on your taxes. This is the place to ask questions about dependents, real estate, and other various scenarios that play a significant role in what taxes you pay.

Posts: 1
Registered: ‎08-01-2017
Accepted Solution

MCC Mortgage Credit Certificate

My wife and I will be moving to North Carolina for a new job. We are looking to buy our first house around the same time. Our real estate agent recommended we find information regarding the Mortgage Credit Certificate before purchasing. I believe we exceed the income to qualify jointly, but since my wife should qualify for the mortgage on her own, we were considering that route. My question is this: If she purchases the house without my name on it and qualifies for the MCC individually, can we still file jointly? If I have read correctly, we couldn't claim the student loan interest if we filed separately. Thoughts?
Trusted Council Member
Posts: 6,191
Registered: ‎02-23-2016

Re: MCC Mortgage Credit Certificate

Hi rpm757,


Welcome to the H&R Block community.


In order to get a mortgage interest credit certificate and be eligible to claim the mortgage interest credit you will need to contact the appropriate government agency in North Carolina.  I'm sure I can find out what you need to do if you would like.


There is no income requirement for this credit under the IRS.  The only IRS limits are the tax liability limit (it's a non-refundable credit) and the limit based on the indebtedness percentage on your certificate.  Income limits would be something that you would have to ask your state about.


Yes, you can file jointly even if only one of you qualifies for the credit under the state requirements.  I would recommend doing so because if you file separately you not only lose the student loan interest deduction but you also lose all but a couple of the tax credits and most of the 1040 deductions, and you're limited on numerous other items in one way or another.  Of course if you're unsure about which way to go then you might consider preparing your return both ways and going with the option that yields the better outcome.


Also note that when you purchase a house you have several other things that are deductible.  You can deduct the mortgage interest, mortgage insurance, and real estate taxes that you paid over the course of the year on Schedule A.  You can also deduct assessment fees for the upkeep of public works that were already in existence when you bought the house in the miscellaneous section on Schedule A.  You can also deduct interest, points, and real estate taxes that you paid at the time of closing on Schedule A, although points may have to be spread across the life of your loan.  The first full year of home ownership usually yields enough deductible expenses to make Schedule A worth more than your standard deduction, but I would compete one to see where you're at each year even if you come out better taking the standard deduction every once in a while.


If you have any other questions I'll be glad to help.



Senior Tax Advisor (Tampa, FL)