TaxSmart Mortgage Credit Certificate

TaxSmart is a Mortgage Credit Certificate (MCC) program providing a federal income tax credit to qualified home buyers. Under the program, a buyer would receive an MCC to reduce income taxes by an amount equal to 20% of the interest paid on a mortgage.

Federal law requires that a home buyer satisfy each of the following guidelines:

First-Time Homebuyer or Target Area Purchase
First-time homebuyers are eligible. Non first-time home buyers are eligible if the subject property is located in a designated target area.

Income
Because the program is intended to benefit low- and moderate-income households, federal law imposes maximum limits on the annual gross income of home buyers.

Purchase Price
Federal law imposes limits on the purchase price of homes financed under the program.

Principal Residence
The buyer must occupy the home as a principal residence within a reasonable period which, under most circumstances, may not exceed 60 days after financing is provided.

One-to-Four-Family Home
Each residence financed must contain 1-4 units. A one-family residence includes a detached home, one unit of a duplex, a townhouse or a condominium unit.

New Mortgage
The mortgage loan financed in connection with a credit certificate is required to be a new mortgage and may not replace a prior mortgage on the home (whether or not previously repaid).

Program Area
In order to be eligible for a certificate, the home financed under the program must be located in the City of Chicago.

MCC’s will be issued to eligible home buyers on a first-come, first-served basis. The certificates are available in connection with any type of mortgage loan (except loans from tax-exempt bond programs), including fixed rate and adjustable rate mortgages.

Please Note: First-time homebuyers must receive pre-purchase counseling to be eligible and must provide a Certificate of Completion with their applications. Purchase Price limits are adjusted periodically.

Income Limits
1 person household
$60,320 (Non-Target Area)
$72,384 (Target Area)

2 person household
$75,400 (Non-Target Area)
$90,480 (Target Area)

3+ person household
$86,710 (Non-Target Area)
$105,560 (Target Area)

Purchase Price Limits
1 Unit Non-Target
$325,894 (Existing)
$325,894 (New Construction)

1 Unit Target
$398,315 (Existing)
$398,315 (New Construction)

2 Unit Non-Target
$367,060 (Existing)
Not eligible (New Construction)

2 Unit Target
$448,629 (Existing)
$448,629 (New Construction)

3 Unit Non-Target
$445,960 (Existing)
Not eligible (New Construction)

3 Unit Target
$545,063 (Existing)
Not eligible (New Construction)

4 Unit Non-Target
$514,570 (Existing)
Not eligible (New Construction)

4 Unit Target
$628,919 (Existing)
Not eligible (New Construction)

Perl Mortgage is a Preferred Lender for the TaxSmart MCC program.  For more information, please contact my offices directly at 312-377-1706, or you can email me at bdixon@perlmortgage.com.