M1HOME - First-Time Homebuyers Savings Account
The Minnesota First-Time Homebuyer Savings Account (M1HOME) is a state-specific program designed to assist individuals in saving for their first home. This account allows eligible taxpayers to save funds for qualified homebuying expenses, such as down payments, closing costs, construction costs, or financing the construction of a single-family residence.
Purpose of Schedule M1HOME
- Register a first-time homebuyer savings account in Minnesota.
- Designate a qualified beneficiary for the account.
- Determine any subtraction (if earnings are tax-free) or addition (if nonqualified withdrawals are made) to taxable income.
- Calculate any additional tax due if funds are withdrawn for non-qualified purposes.
When to File Schedule M1HOME
You must complete Schedule M1HOME if you:
- Are the account holder of more than one first-time homebuyer savings account (complete a separate form for each).
- Received interest or dividends from the account in 2025.
- Made a nonqualified withdrawal from the account (funds not used for qualified expenses).
Qualified Expenses
Funds from the account can be used for:
- Down payment on a single-family residence.
- Closing costs.
- Costs of construction.
- Financing the construction of a single-family residence.
Reporting Nonqualified Withdrawals
If you withdraw funds from the account and do not use them for qualified expenses, you may be required to include those amounts in your taxable income. This is reported on Line 5 of Form M1 (Minnesota Individual Income Tax Return) and requires completing Schedule M1HOME to determine the addition amount.
Reporting Earnings on Contributions
If you contributed to a designated first-time homebuyer savings account since 2017, you may be eligible to subtract your earnings on the account. This is reported on Line 27 of Form M1 and requires completing Schedule M1HOME to determine the subtraction amount.
How to Add Schedule M1HOME in OLT Software
To add Schedule M1HOME while filing your Minnesota state tax return using OLT (Online Taxes) software:
- From within your tax return (Online), click on "State" in the left menu.
- Click "Start or Revisit Minnesota State."
- Navigate to the "Deductions" section and locate "Minnesota First-Time Homebuyer Savings Account - M1HOME."
- Follow the on-screen instructions to complete the form.
Important Notes
- Complete one Schedule M1HOME per qualified account.
- Include details such as bank name, account number, date opened, start and end-of-year balances, and qualified beneficiary information.
- For questions or forms, visit www.revenue.state.mn.us, email individual.incometax@state.mn.us, or call 651-296-3781 or 1-800-652-9094.
Source:
Schedule M1HOME - First-Time Homebuyer Savings Account
Form M1 Instructions
Disclaimer: Always verify information with official Federal or State Department of Revenue Forms and Instructions.