New Mexico is home to one of the most diverse landscapes in the world. You may find six out of seven life zones in the world in this 5th largest state in the US. The rich biodiversity includes vast deserts, lush forests, and even snow-capped towering peaks. Aside from the vibrant ecosystem of the “land of enchantment,” New Mexico boasts of 300 days of sunshine per year.
This abundance of radiant energy makes it a perfect venue to harness the power of the sun to generate electricity. And with New Mexico solar tax credits in place, the state is well on its way to becoming the leader in renewable energy generation.
New Mexico already has a total of 21,330 solar power installations that can power about 214,000 homes. This number is expected to grow in the coming years because of new legislation that aims to achieve 100% carbon-free electricity generation by 2045. The government provides financial tools that encourage consumers to shift to solar power as an excellent source of clean and renewable energy.
Financial tools include rebates, tax incentives, and net metering systems. These allow consumers to save money while using solar energy. It also fosters a faster ROI for their investments on solar panel installations.
Here are New Mexico solar tax credits that can allow you to stretch that valuable dollar as you shift to solar energy:
Sustainable Building Tax Credit Program
If you have installed a solar system at home, you can apply for a Sustainable Building Tax Credit Program. You need to acquire a US Green Building Council Certification to earn up to $6.50 per square foot of your home’s floor area. The cap is set at 2,000 square feet. You could earn as much as $13,000 in tax credits when you purchase a solar system for your home.
Property Tax Assessment Exemptions
New Mexico exempts residential solar energy systems from property tax assessments. House Bill 233, enacted in 2010, states that residential solar systems will not be considered as physical improvements and, therefore, will not result in an increase in the value of the property for tax purposes. However, future assessments can include the cost of a solar energy system if the property will be sold.
The property tax exemption of New Mexico will allow you to save money year after year. A residential solar power system increases the value of a home by almost twenty times the annual electricity bill savings. In normal circumstances, you need to pay taxes on the increased cost. But because of the exemption program, your fees remain the same.
US Federal Residential Renewable Energy (RE) Tax Credits
The current solar bill, also known as “New Solar Market Development Tax Credit”, provides an income tax credit for 10% of solar installation expenses of a home or a business. Credits will be capped at $6000 per system with a maximum allowance of $10 million for the whole program.
The overall outlook of incentives in New Mexico is sunnier than ever. The federal government is doing its best to encourage and support New Mexicans to embrace this clean and renewable source of energy. It may bring forth hefty savings for taxpayers, but the most significant benefit would be a sustainable environment for all.