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                                                                                                                                                      OMB No. 1545-0074
                                                    Mortgage Interest Credit
Form  8396                                    (For Holders of Qualified Mortgage Credit Certificates Issued by   
                                                  State or Local Governmental Units or Agencies)                                                      2021
Department of the Treasury                    ▶ Go to www.irs.gov/Form8396 for the latest information.                                                Attachment   
Internal Revenue Service (99)                     ▶ Attach to Form 1040, 1040-SR, or 1040-NR.                                                         Sequence No. 138
Name(s) shown on your tax return                                                                                     Your social security number 

Enter the address of your main home to which the qualified mortgage certificate relates if it is different from the address shown on your tax return. 

Name of Issuer of Mortgage Credit Certificate             Mortgage Credit Certificate Number                         Issue date 

Before you begin Part I, figure the amounts of any of the following credits you are claiming: credit for the elderly or the disabled, 
alternative motor vehicle credit, and qualified plug-in electric drive motor vehicle credit.
Part I  Current Year Mortgage Interest Credit 

1     Interest paid on the certified indebtedness amount. If someone else (other than your spouse if filing 
      jointly) also held an interest in the home, enter only your share of the interest paid  .    .   . .       . . . 1 

2     Enter the certificate credit rate shown on your     Mortgage Credit Certificate. Do not enter the interest 
      rate on your home mortgage              . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 2                                               % 

3     If line 2 is 20% or less, multiply line 1 by line 2. If line 2 is more than 20%, or you refinanced  your 
      mortgage and received a reissued certificate, see the instructions for the amount to enter  .              . . . 3 
      You must reduce your deduction for home mortgage interest on Schedule A (Form 1040) by the 
      amount on line 3.

4     Enter any 2018 credit carryforward from line 16 of your 2020 Form 8396  .              . . . .   . .       . . . 4 

5     Enter any 2019 credit carryforward from line 14 of your 2020 Form 8396  .              . . . .   . .       . . . 5 

6     Enter any 2020 credit carryforward from line 17 of your 2020 Form 8396  .              . . . .   . .       . . . 6 

7     Add lines 3 through 6  .       . .      . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 7 
8     Limitation based on tax liability. Enter the amount from line 3 of the Credit Limit Worksheet in the
      instructions  .         .  . . . .      . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 8 

9     Current year mortgage interest credit. Enter the smaller of line 7 or line 8. Also include this amount 
      on Schedule 3 (Form 1040), line 6g  .           . . . . . . .   .   . . . .            . . . .   . .       . . . 9 
Part II Mortgage Interest Credit Carryforward to 2022 (Complete only if line 9 is less than line 7.) 

10    Add lines 3 and 4          . . . .      . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 10 

11    Enter the amount from line 7.           . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 11 

12    Enter the larger of line 9 or line 10 .     .   . . . . . . .   .   . . . .            . . . .   . .       . . . 12 

13    Subtract line 12 from line 11 .         . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 13 

14    2020 credit carryforward to 2022. Enter the smaller of line 6 or line 13 .             . . . .   . .       . . . 14 

15    Subtract line 14 from line 13 .         . . .   . . . . . . .   .   . . . .            . . . .   . .       . . . 15 

16    2019 credit carryforward to 2022. Enter the smaller of line 5 or line 15 .             . . . .   . .       . . . 16 

17    2021 credit carryforward to 2022. Subtract line 9 from line 3. If zero or less, enter -0-        . .       . . . 17 
For Paperwork Reduction Act Notice, see your tax return instructions.                          Cat. No. 62502X                                        Form 8396 (2021)

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Form 8396 (2021) Page 2

General Instructions Specific Instructions
Future Developments Part I—Current Year Mortgage Interest Credit
For the latest information about developments related to Form 8396 Line 1
and its instructions, such as legislation enacted after they were Enter the interest you paid during the year on the loan amount
published, go to www.irs.gov/Form8396. (certified indebtedness amount) shown on your MCC. In most
Purpose of Form cases, this will be the amount in box 1 on Form 1098, Mortgage
Interest Statement, or on a similar statement you received from your
Use Form 8396 to figure the mortgage interest credit for 2021 and mortgage holder. If the loan amount on your MCC is less than your
any credit carryforward to 2022. total mortgage loan, you must allocate the interest to determine the
Who Can Claim the Credit part that relates to the loan covered by the MCC. See Pub. 530 for
an example of how to allocate the interest.
You can claim the credit only if you were issued a qualified
Mortgage Credit Certificate (MCC) by a state or local governmental Line 2
unit or agency under a qualified mortgage credit certificate The certificate credit rate cannot be less than 10% or more than
program. 50%.
Homestead Staff Exemption Certificates, and certificates Line 3
issued by the Federal Housing Administration, If you refinanced, see Refinanced Mortgage on this page.
▲! Department of Veterans Affairs, and Farmers Home
CAUTION Administration, do not qualify for the credit. If the certificate credit rate shown on line 2 is more than 20%,
multiply line 1 by line 2, but do not enter more than $2,000 on line 3.
The home to which the certificate relates must be your main If you and someone else (other than your spouse if filing jointly) held
home and must also be located in the jurisdiction of the an interest in the home, the $2,000 limit must be allocated to each
governmental unit that issued the certificate. owner in proportion to the interest held. See Dividing the Credit in
If the interest on the mortgage was paid to a related person, you Pub. 530 for an example of how to make the allocation.
cannot claim the credit. Reduction of home mortgage interest deduction on Schedule A
Refinanced Mortgage (Form 1040). If you itemize your deductions on Schedule A, you
You can refinance your mortgage without losing this credit if your must reduce the amount of home mortgage interest you would
existing MCC is reissued and the reissued certificate meets all of otherwise deduct on Schedule A by the amount on Form 8396, line
the following conditions. 3, and report the reduced amount on Schedule A. You must do this
even if part of the amount on line 3 is carried forward to 2022.
• It must be issued to the holder(s) of the existing certificate for the
same property. Line 8—Credit Limit Worksheet
• It must entirely replace the existing certificate. The holder cannot Keep for Your Records
retain any portion of the outstanding balance of the existing
certificate. 1. Enter the amount from Form 1040, 1040-SR, or
• The certified indebtedness on the reissued certificate cannot 1040-NR, line 18 . . . . . . . . . . 1.
exceed the outstanding balance shown on the existing certificate.
2. Form 1040 or Form 1040-SR filers: Enter the
• The credit rate of the reissued certificate cannot exceed the credit total of all amounts (if any) from Form 1040 or
rate of the existing certificate. 1040-SR, line 19*; Schedule 3 (Form 1040), lines
• The reissued certificate cannot result in a larger amount on line 3 1 through 4, 6d, 6e, 6f, and 6l; and Form 5695,
than would otherwise have been allowable under the existing line 30.
certificate for any tax year.
For each tax year, you must determine the amount of credit that Form 1040-NR filers: Enter the total of all
you would have been allowed using your original MCC. To do this, amounts (if any) from Form 1040-NR, line 19*;
multiply the interest that was scheduled to be paid on your original Schedule 3 (Form 1040), lines 1, 2, 4, 6e, 6f, and
mortgage by the certificate rate on your original MCC. The result 6l; and Form 5695, line 30 . . . . . . . 2.
may limit your line 3 credit allowed when you have a reissued MCC,
even if your new loan has a lower interest rate. 3. Subtract line 2 from line 1. Enter this amount on
Form 8396, line 8. If zero or less, enter -0- here
If the certificate credit rates are different in the year you and on Form 8396, lines 8 and 9, and go to Part
refinanced, attach a statement showing separate calculations for II of Form 8396 . . . . . . . . . . 3.
lines 1, 2, and 3 for the applicable parts of the year when the
original MCC and the reissued MCC were in effect. Combine the * If you are directed to complete Form 8396 by Credit Limit
amounts from both calculations for line 3. Enter that total on line 3 Worksheet B in the Instructions for Schedule 8812 (Form 1040),
of the form and enter “see attached” on the dotted line next to include the amount from line 14 of Credit Limit Worksheet B instead
line 2. of the amount from Form 1040, 1040-SR, or 1040-NR, line 19.
For more details, see Regulations section 1.25-3(p). Part II—Mortgage Interest Credit Carryforward to 2022
Recapture of Credit If the amount on line 9 is less than the amount on line 7, you may
If you buy a home using an MCC and sell it within 9 years, you may have an unused credit to carry forward to the next 3 tax years or
have to recapture (repay) some of the credit. See Pub. 523, Selling until used, whichever comes first. The current year credit is used
Your Home; and Form 8828, Recapture of Federal Mortgage first and then the prior year credits, beginning with the earliest prior
Subsidy. year.
If you have any unused credit to carry forward to 2022, keep a
Additional Information copy of this form to figure your credit for 2022.
See Pub. 530, Tax Information for Homeowners, for more details. If you are subject to the $2,000 credit limit because your
certificate credit rate is more than 20%, no amount over
▲! the $2,000 limit (or your prorated share of the $2,000 if
CAUTION you must allocate the credit) may be carried forward for
use in a later year.

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