Federal Mortgage Interest Tax Credit
The Internal Revenue Service allows you to claim the federal mortgage interest tax credit if you participated in the mortgage credit certificate program. North Carolina does not allow a mortgage interest tax credit. If you itemized your deductions and claimed the mortgage interest tax credit on your federal return because you participated in the mortgage credit certificate (MCC) program, you may deduct the amount shown on line 3 of Federal Form 8396.
If you qualify for this deduction enter the amount from line 3 of Federal Form 8396 on line 49 of your North Carolina Form D-400. This amount will become part of the total line 9 amount on page 1 of your Form D-400.
Remember, you must claim North Carolina itemized deductions and claim the federal mortgage interest tax credit on your federal return to claim this deduction on your North Carolina return.