Housing Academy

A recapture tax may apply only in certain circumstances:

*If you sell your home within nine years.

*If your income has increased significantly and you have a substantial gain on the sale of your home. 

The IRS Form 8828 shows just how the tax is calculated.

More information on the Federal Recapture Tax.



Information to consider (cont'd):

Eligible properties are single-family homes, new construction, manufactured homes (permanently) affixed or on leased land.  Homes located on Native American trust land, located on Targeted Areas and Non-Targeted Areas.  Visit our Targeted Areas page to see if the property of interest is in a Targeted Area.  In addition, there are business-use limits.  No more than 15% of the residence may be used for trade or business purposes.

The MCC tax credit is valid for the life of the loan, or so long as you remain the owner/occupant of the residence.  You also must attend a Washington Housing Finance Commission sponsored homebuyer seminar.

Questions about the MCC Program?

If you have further questions regarding the MCC Tax Credit and how it applies in Washington State, then simply call us at 425-390-INFO or email us at askus@washingtonhousingassociation.org 

 Clark/Island $330,000 $360,000
 Jefferson/Pierce/Snohomish $370,000 $395,000
 King/San Juan $450,000 $475,000
 Kitsap/Whatcom $300,000 $335,000
 Skagit $285,000 N/A
All Other Counties  $235,000 $285,000

Acquisition Cost Limits:

Borrowers must meet these property acquisition cost limits.  Acquisition cost limits of a single-family residence cannot exceed the following:



1-2 Persons


3 or more Persons


1-2 Persons


3 or more Persons

 Jefferson/Skagit/Whatcom $70,000 $80,000 N/A N/A
 Clark/Island/Kitsap/Pierce/Thurston $80,000 $90,000 $80,000 $90,000
 King/Snohomish $90,000 $97,000 $90,000 $97,000

 San Juan

 $78,000 $90,000
 All other counties  $65,000 $75,000 $80,000 $85,000

Income limitations do apply with the MCC tax credit 

Borrowers can't exceed these Maximum Annual Income Limits:

Information to Consider

The Mortgage Credit Certificate (MCC) is available with many types of loan programs.  MCC's are available with fixed rates and adjustable rates.  It can be combined with conventional loans, FHA, VA, and Rural development mortgages. There is a non-refundable $650 fee that will be paid prior to closing on your new home. 

The MCC tax credit is available with new home purchases only.  Any refinancing on an existing mortgage is not an option. Unless the borrower is replacing a type of short-term bridge loan with a term of 24 months or less.  Or if you are trying to refinancing using an existing certificate, further guidelines & restrictions do apply.  Contact us at 425-390-INFO. 

A Mortgage Credit Certificate (MCC) helps Washington state homebuyers achieve homeownership!

Each month it is now possible to get a tax credit which will show on your regular paycheck.  The MCC is not a mortgage, it is a tax credit. The Mortgage Credit Certificate simply allows you to afford more in a house payment by giving you a monthly tax credit.  The majority of Washington state homebuyers are not aware of this wonderful opportunity.  If you have been thinking about purchasing a home now or sometime in the near future, you need to ask your participating lender to add the MCC to your loan application.  A Mortgage Credit Certificate is a Federal Tax Credit allowing you to claim up to 20% of the annual mortgage interest paid.

Washington Housing Association teaches about the MCC programs in all of our homebuyer classes.  We have gathered information and examples below regarding this program.  If you have questions regarding the MCC tax credit, please call us or simply email us at askus@washingtonhousingassociation.org.

How to Apply

All applications are accepted on a first-come, first-served basis. The lending institution that you are working with will submit your loan application and update you on your approval status. You must attend a homebuyer seminar. There are specific statewide lenders that participate. Click here for list of participating lending institutions.
Mortgage Credit Certificate Information
An Outstanding Federal Income Credit
or Homebuyers!