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Official form guide
Form 8396: Mortgage Interest Credit
IRS Form 8396 is used to figure the mortgage interest credit for 2025 and any resulting carryforward to 2026. A key fact is that the certificate credit rate cannot be less than 10% or more than 50%.
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IRS Form 8396 - Mortgage Interest Credit
IRS Form 8396 is used to figure the mortgage interest credit for 2025 and any resulting carryforward to 2026. A key fact is that the certificate credit rate cannot be less than 10% or more than 50%.
Risk Radar
Scan points- 1Do not enter the home mortgage interest rate on Line 2; use the certificate credit rate instead.
- 2Failing to reduce your deduction on Schedule A (Form 1040) by the amount on line 3 of Part I.
- 3Entering the home mortgage interest rate instead of the certificate credit rate on Line 2.
- 4Not allocating interest correctly when only a portion of the loan is covered by the MCC.
- 5Omitting any required carryforward amounts from lines 4, 5, or 6 in Part I.
Plain English
This form helps determine how much of your home loan interest you can claim as a tax credit for the year 2025. It also calculates if any unused portion of that credit must be carried forward to help reduce taxes in 2026. You use this form when you have received a qualified Mortgage Credit Certificate (MCC).
Submission Date
- Filing date: 2025-12-17 09:10:36
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when you were issued a qualified Mortgage Credit Certificate (MCC) by a state or local governmental unit or agency and need to figure your mortgage interest credit for 2025 or any carryforward to 2026.
- Do not use Form 8396 if the home certificate relates to Homestead Staff Exemption Certificates, or certificates issued by the Federal Housing Administration, Department of Veterans Affairs, or Farmers Home Administration.
- Check Form 1040 instead when filing your primary return (or Form 1040-SR/1040-NR) as this form attaches to those returns.
Form selector
Use this form or another form?
Filing this form
The Mortgage Interest Credit is attached to Form 1040 to claim it for the current year.
✓ Confirm you are claiming the credit on Form 1040, 1040-SR, or 1040-NR.
Filing this form
This form is used when filing as a Senior Citizen and claiming the Mortgage Interest Credit.
✓ Verify that your tax return is Form 1040-SR before completing Part I.
Filing this form
This form is used for Nonresident Aliens who are claiming the Mortgage Interest Credit.
✓ Ensure you use Form 8396 when filing with Form 1040-NR.
Refinancing your mortgage
If you refinance, ensure the reissued MCC meets specific conditions to keep the credit intact.
✓ Check that the new certificate is issued to the existing holder(s) for the same property.
Deadline or filing window
The form calculates the credit for 2025, and if there is an unused credit, it carries forward to 2026. The current-year credit is used first, followed by prior-year credits starting with the earliest year available. No specific filing deadline date is provided in the source.
Checklist
What you need before filling it out
Line 1
Interest paid during the year on the loan amount (certified indebtedness) shown on your MCC · Form 1098, Box 1 (usually)
Credit Limit Worksheet Line 2
Total of amounts from specific lines/schedules · Various forms listed in source
Line 3
The calculated mortgage interest credit amount · Form 8396 calculations (Lines 1, 2, 9)
Refinanced Mortgage Conditions
Existing MCC details & Reissued Certificate · Specific conditions listed on Page 2
Credit Carryforward (e.g., 2024 to 2026)
Smaller of line 6 or line 13 · Form 8396 calculation section
Before you submit
- 1Ensure all Name(s) shown on your tax return are accurately listed.
- 2Verify you have entered the correct Social Security Number.
- 3Confirm the address provided is the main home to which the certificate relates (if different from the tax return address).
- 4Check that you have correctly identified and listed the Name of issuer of Mortgage Credit Certificate.
- 5Ensure the Issue date for the MCC is accurately recorded.
- 6Verify that the amount entered on Line 3 reflects the smaller of line 5 or line 15 (for the 2025 carryforward).
- 7Confirm you have calculated and entered the final credit limit onto Line 8.
How to file this form
- 1Calculate preliminary credits by determining amounts for the elderly/disabled, alternative motor vehicle, and qualified plug-in electric drive motor vehicle credits (Part I).
- 2Complete Part I calculations on Form 8396 to determine the primary credit amount allowed for the year.
- 3If refinancing, complete all necessary comparative calculations and enter the combined total onto Line 3 of Form 8396.
- 4Fill out the Credit Limit Worksheet (Line 8) by calculating the maximum allowable credit based on your tax return inputs.
- 5Sign the form before sending it to the IRS.
- 6Keep a copy of the completed and signed Form 8396 for your records.
- 7Attach Form 8396 to your filed Form 1040, 1040-SR, or 1040-NR.
Known limitations
- 1The mortgage interest credit can only be claimed if a qualified Mortgage Credit Certificate (MCC) was issued by a state or local governmental unit or agency.
- 2Homestead Staff Exemption Certificates do not qualify for the credit.
- 3Certificates issued by the Federal Housing Administration, Department of Veterans Affairs, and Farmers Home Administration do not qualify for the credit.
Field map
Compact field-by-field guide
General Info
2 items
Full legal name and taxpayer identification number (SSN or EIN).
Current mailing address.
Details
2 items
Complete all applicable sections of this form according to the official IRS instructions.
Enter the relevant dollar amount if this form involves tax calculation.
Certification
1 items
Read and acknowledge any certifications required by this form.
Signatures
1 items
Sign and date. Unsigned forms cannot be processed.
Almost done reviewing the fields?
Fillable formOpen in Editor->The current edition is 20/25, and users should visit www.irs.gov/Form8396 for the latest information regarding developments related to Form 8396.
What changed or needs a fresh check
- Edition date — confirm the revision reads 20/25.
- OMB Number — ensure the form has OMB No. 1545-0074 20 25.
- Filing requirement — confirm you are attaching Form 8396 to Form 1040, 1040-SR, or 1040-NR.
- Issuer name — verify the official title is 'Mortgage Interest Credit (For Holders of Qualified Mortgage Credit Certificates Issued by State or Local Governmental Units or Agencies)'.
Quick Facts
Downloads
After you file
- 1Keep a copy of Form 8396 to figure your mortgage interest credit for 2026 if there is an unused credit carryforward.
- 2If you itemize deductions on Schedule A, reduce the home mortgage interest deduction on Schedule A by the amount entered on Form 8396, line 3.
- 3This reduction must be reported on Schedule A even if part of the amount on line 3 is carried forward to 2026.
- 4If zero or less is entered on Form 8396, lines 8 and 9, proceed to Part II of Form 8396.
Sources
- SRCForm 8396 states it attaches to Form 1040, 1040-SR, or 1040-NR (Instructions p.1).
- SRCThe form is used to figure the mortgage interest credit for 2025 and any carryforward to 2026 (Form p.2).
- SRCLine 2 (Certificate credit rate) cannot be less than 10% or more than 50% (Form p.2).
- SRCIf you refinanced, the instructions for line 3 are detailed on Form 8396 (Instructions p.1).
- SRCIf the certificate credit rate is over 20%, you multiply line 1 by line 2, but do not enter more than $2,000 on line 3 (Form p.2).
- SRCThe reduction to your home mortgage interest deduction on Schedule A occurs based on Form 8396, line 3 (Form p.2).
Common confusion points
What if my interest paid is only a portion?
Enter only your share of the interest paid on Line 1, especially if someone else (other than a joint spouse) also held an interest in the home.
→ Check that you are entering *your* specific share amount.
Do I use the mortgage interest rate or the certificate credit rate for Line 2?
You must enter the percentage shown on your Mortgage Credit Certificate on Line 2; do not enter the actual interest rate from your home mortgage statement.
→ Verify the number entered on Line 2 is exactly what is printed on the MCC.
How does the $2,000 limit apply if I co-own?
If you and someone else (other than your spouse filing jointly) held an interest, the $2,000 limit on Line 3 must be allocated to each owner in proportion to the interest held.
→ Check Pub. 530 for guidance on allocating the $2,000 limit among co-owners.
What happens if my credit rate is over 20%?
If your certificate credit rate is more than 20%, you multiply Line 1 by Line 2, but you cannot enter more than $2,000 on Line 3.
→ Confirm the maximum amount entered on Line 3 does not exceed $2,000 (or its prorated share).
Can I carry forward my unused credit?
Yes, if the amount calculated on Line 9 is less than the amount on Line 7, you may carry it to 2026.
→ Keep a copy of Form 8396 to calculate your credit for 2026.
What happens to the $2,000 limit when carrying forward?
If you are subject to the $2,000 limit because your rate is over 20%, no amount over that limit (or its prorated share) can be carried forward.
→ Confirm that if Line 3 was capped at $2,000, only amounts up to that cap can be used/carried forward.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Pub. 530 (This publication provides examples for allocating interest if the loan amount is less than your total mortgage loan).
Questions about IRS Form 8396
What is IRS Form 8396 used for?
This form helps determine how much of your home loan interest you can claim as a tax credit for the year 2025. It also calculates if any unused portion of that credit must be carried forward to help reduce taxes in 2026. You use this form when you have received a qualified Mortgage Credit Certificate (MCC).
Who must file IRS Form 8396?
You can claim the mortgage interest credit only if you were issued a qualified Mortgage Credit Certificate (MCC) by a state or local governmental unit or agency under a qualified mortgage credit certificate program.
What information does IRS Form 8396 require?
Part I calculates your Current-Year Mortgage Interest Credit, while Part II determines any Mortgage Interest Credit Carryforward to 2026. These parts collect details like the interest paid and the applicable certificate credit rate.
When is IRS Form 8396 due?
The form is used to figure the mortgage interest credit for 2025 and any carryforward to 2026; a specific filing deadline date is not stated in the official source.
How do I complete IRS Form 8396?
First, complete Part I by entering interest paid (Line 1) and the certificate credit rate (Line 2). Next, calculate the current-year credit on Line 9. If Line 9 is less than Line 7, proceed to Part II to determine the carryforward amount for 2026.
What happens if IRS Form 8396 is filed incorrectly?
If zero or less credit results on line 3 of Part I, you must enter -0- on lines 8 and 9, which directs the filing to Part II; failure to do this impacts carryforward calculations.
What if my interest paid is only a portion?
Enter only your share of the interest paid on Line 1, especially if someone else (other than a joint spouse) also held an interest in the home. Check that you are entering *your* specific share amount.
Do I use the mortgage interest rate or the certificate credit rate for Line 2?
You must enter the percentage shown on your Mortgage Credit Certificate on Line 2; do not enter the actual interest rate from your home mortgage statement. Verify the number entered on Line 2 is exactly what is printed on the MCC.
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