New Mexico
The New Mexico Solar Market Development Tax Credit, or Solar Tax Credit, was established in 2006 to help you invest in Clean Energy for your home or business. Here's the information you need to invest in solar energy and take advantage of the Solar Tax Credit and other financial incentives.
After you purchase and install your solar system, you can receive a tax credit when you file your federal and state personal income tax forms. The federal tax credit for a solar PV or thermal system is 30% of the cost of the system capped at $2,000. New Mexico provides additional tax credits up to $9,000, for a total of up to $11,000 when combined with the federal tax credit. If you install both a photovoltaic and a thermal solar system, you can receive up to $9,000 in state tax credits for each system.
Basically any home owner- or contractor-installed solar thermal or PV system that meets state or local building code requirements qualifies for the credit. The solar thermal systems also must have collectors that are listed by the Solar Rating and Certification Corporation SRCC. Through New Mexico's Solar System Certification Application process, the state will review your system to see that it meets the state's requirements to ensure that you have invested in a high quality solar system that will provide long-term financial and environmental benefits.
There are other solar investment incentives available for residential customers. With these added incentives it is possible, depending on the size of the system, to get a check from the electric utility, instead of a bill. Residential customers with PV systems can reduce their electricity bill through utility company net metering programs and Renewable Energy Credit (REC) programs. For example, see the PNM Solar PV Program. The value of PV power for net metering programs is the same as the utility company's retail price. (In Albuquerque, for example) this is about 8 cents per kilowatt-hour.)
It is possible for a residence to generate more electricity than is used, causing the meter to run backward, which means the utility provides a credit toward future electricity use or pays the residential customer for the excess power generated. Some utility companies pay a premium for the renewable energy attributes of the electricity generated by PV in addition to the going retail rate for electricity. For example, PNM currently pays 13 cents a kilowatt-hour for PV-generated electricity.
To get the Federal Solar Tax Credit just complete IRS Form 5695: Residential Energy Credits for Tax Year 2007, and attach it to your form 1040. See your tax preparer or accountant for details.
To apply for and receive the New Mexico Tax Credit you have to download and complete the Solar System Certification Application form. You will need to provide information about yourself and the installer, and information about the location, type, size, and cost of the system.
Then download and complete the Solar System Installation Form. You will need to provide information about yourself, the contractor (if contractor-installed), and a building code authority system inspection.
Send the above forms to the State of New Mexico Energy, Minerals, and Natural Resources Department (EMNRD) (address on the forms). Upon approval, EMNRD will send you a letter certifying the system and approving you for the tax credit. When you file your New Mexico State Income Tax return, fill out and attach form RPD-41317, Solar Market Development Income Tax Claim Form, along with the certification letter, to your income tax return. Your tax preparer or accountant can provide you with additional assistance.