TITLE 3 TAXATION
CHAPTER 3 PERSONAL
INCOME TAXES
PART 14 NEW SOLAR MARKET DEVELOPMENT
INCOME TAX CREDIT
3.3.14.1 ISSUING
AGENCY: Energy, Minerals and Natural Resources
Department, Energy, Conservation and Management Division.
[3.3.14.1 NMAC – Rp,
3.3.14.1 NMAC, 7/16/2024]
3.3.14.2 SCOPE: 3.3.14
NMAC applies to the application and certification procedures for administration
of the new solar market development income tax credit.
[3.3.14.2 NMAC - Rp,
3.3.14.2 NMAC, 7/16/2024]
3.3.14.3 STATUTORY AUTHORITY: 3.3.14
NMAC is established under the authority of Section 7-2-18-31 and Subsection
9-1-5 NMSA 1978.
[3.3.14.3 NMAC - Rp, 3.3.14.3 NMAC, 7/16/2024]
3.3.14.4 DURATION: Permanent.
[3.3.14.4 NMAC - Rp,
3.3.14.4 NMAC, 7/16/2024]
3.3.14.5 EFFECTIVE
DATE: July 16, 2024, unless a later date is cited at
the end of a section.
[3.3.14.5
NMAC - Rp, 3.3.14.5 NMAC, 7/16/2024]
3.3.14.6 OBJECTIVE: 3.3.14
NMAC’s objective is to establish procedures for administering the certification
program for the new solar market development income tax credit.
[3.3.14.6 NMAC - Rp,
3.3.14.6 NMAC, 7/16/2024]
3.3.14.7 DEFINITIONS:
A. “Applicant” means a New Mexico taxpayer
that has installed a solar energy system at a residence, business or
agricultural enterprise that the taxpayer owns or a New Mexico taxpayer who has
installed a solar energy system at a residence, business, or agricultural
enterprise held in leasehold and located on a federally recognized Indian
nation, tribe or pueblo that is located in whole or in part within New Mexico and
who requests that the department certify the solar energy system pursuant to 3.3.14
NMAC so that the taxpayer may receive a state tax credit.
B. “Application package” means the
application documents an applicant submits to the department for certification
to receive a state tax credit.
C. “Array” means the collectors of a solar
thermal system or the modules of a photovoltaic system.
D. “Building code authority” means the New
Mexico regulation and licensing department, construction industries department
or the local government agency having jurisdiction for building, electrical and
mechanical codes.
E. “Certified” or “certification” means department approval of a solar energy system,
which makes the applicant owning the system eligible for a state tax credit.
F. “Collector” means the solar thermal
system component that absorbs solar energy for conversion into heat or
electricity.
G. “Collector aperture” means the area of
a solar thermal collector that absorbs solar energy for conversion into usable
heat.
H. “Component” means a solar energy
system’s equipment and materials.
I. “Department” means the energy, minerals
and natural resources department.
J. “Division” means the department’s
energy conservation and management division.
K. “Energy system” means an engineered
system that delivers solar energy to an end use by flow of fluid or electricity
caused by energized components such as pumps, fans, inverters, or controllers.
L. “Installed”, or
“installation” means the direct work
of placing a solar energy system into service to operate and produce energy at
the expected level for a system of its size, which shall include completion of
any required final inspections, unless the installation is on tribal or pueblo
land in which case contractor certification of installation shall suffice for
the system to meet this definition.
M. “Mobile” means
not permanently connected to a residence, business or agricultural enterprise
or connected to a mobile vehicle that is a part of a residence, business, or
agricultural enterprise.
N. “Module” means
the photovoltaic system component that absorbs sunlight for conversion into
electricity.
O. “New” means
the condition of being recently manufactured and not used previously in any
installation.
P. “New solar market development income tax credit”
means the personal income tax credit the state of New Mexico issues to a
taxpayer for a solar energy system the department has certified pursuant to
3.3.14 NMAC.
Q. “Non-residential”
means a business or agricultural enterprise.
R. “OG” means
operating guidelines that the solar rating and certification corporation has or
will establish including system performance or component characteristics as
defined in the applicable SRCC directory.
Operating guidelines shall be from SRCC directory in effect on March 1, 2006,
or any applicable successive revisions.
S. “Solar collector”
means a solar thermal collector or photovoltaic module.
T. “Solar energy
system” means a solar thermal system or photovoltaic system.
U. “Solar storage
tank” means a tank provided as a component in a solar thermal system that
is not heated by electricity or a heating fuel.
V. “SRCC” means
the solar rating and certification corporation.
W. “Standard test
conditions” means the environmental conditions under which a manufacturer
tests a photovoltaic module for power output, which are a photovoltaic cell
temperature of 25 degrees Celsius and solar insolation of 1000 watts per square
meter on the photovoltaic cell surface.
X. “State tax credit”
means the new solar market development income tax credit.
Y. “Substantially Complete” means a system that produces
energy to the benefit of the residence, business or agricultural enterprise and
has been inspected by the applicable authorities. A system that is
substantially complete shall be eligible for the tax credit even if the original
installation contractor is no longer in business.
Z. “Supplemental state tax credit” means the new
solar market development income tax credit awarded for eligible solar energy
systems installed in calendar years 2020-2023 when certification was not
previously awarded due to exhaustion of credit certification limits.
[3.3.14.7 NMAC - Rp,
3.3.14.7 NMAC, 7/16/2024]
3.3.14.8 GENERAL PROVISIONS:
A. The state tax credit may be claimed for taxable years
prior to January 1, 2032.
B. Only a New Mexico individual taxpayer, corporation or
agricultural enterprise who has purchased and installed, on property that he,
she, or the corporation owns, or, in the case of a federally recognized Indian
nation, tribe or pueblo, holds in leasehold, an operating or substantially
complete solar energy system that the department has certified pursuant to this
part is eligible for a state tax credit for the tax year in which the system is
installed, unless the system is eligible for a supplemental state tax credit.
C. An applicant must own
the residence, business, or agriculture enterprise on which the solar energy
system is located to qualify for the tax credit, unless the applicant has
installed a solar energy system at a residence, business, or agricultural
enterprise located on a federally recognized Indian nation, tribe or pueblo
located in whole or in part within New Mexico, in which case the applicant must
hold the property in leasehold from the applicable Indian nation, tribe or
pueblo. The applicant may rent the residence, business, or agricultural
enterprise that the applicant owns to another entity, however, the renter does
not qualify for the tax credit.
D. Multiple different systems located at the same address
are all eligible for the credit, provided the total amount awarded for all
systems at the same address does not exceed the allocation limit in 3.3.14.15
NMAC; systems must meet eligibility requirements. The restriction in this
paragraph applies even if the solar energy systems are separately metered.
E. A taxpayer who is not a dependent of another individual
and who, on or after March 1, 2020, purchases and installs a solar thermal
system or a photovoltaic system on a residence, business or agricultural
enterprise in New Mexico owned by that taxpayer or on land held by a federally
recognized Indian nation, tribe or pueblo and held in leasehold by that
taxpayer, may apply for, and the department may allow, a credit against the
taxpayer's tax liability imposed pursuant to the Income Tax Act. The tax credit
provided by this section may be referred to as the "new solar market
development income tax credit."
F. A taxpayer
may apply for a new solar market development income tax credit certificate for
the taxable year in which the taxpayer purchases and installs a solar thermal
or photovoltaic system. To receive a new solar market development income tax
credit certificate, a taxpayer shall apply to the department on forms and in
the manner prescribed by the department within twelve months following the
calendar year in which the system was installed.
G. The
annual aggregate amount of credits that may be
certified by the department as eligible is:
(1) in the calendar year 2024 and any
subsequent year thereafter, thirty million dollars ($30,000,000); and
(2) For
calendar years 2020 through 2023, where the calendar year limitation has previously
been met in any one of those years, a total of twenty million dollars
($20,000,000). Such supplemental state tax credits shall be claimed in taxable
year 2023 regardless of whether the system was purchased and installed in
calendar years 2020 through 2023. Applications for supplemental state tax
credits certificates must be submitted on or before 12/31/2025.
H. When
the aggregate amount of certificates issued reaches
the cap in the foregoing paragraph, the department will no longer certify
systems for that year. Applications received after the aggregate limit is
reached shall not be approved and will be returned to applicant. The department
shall keep a record of the order of receipt of all application packages to
ensure the annual aggregate amount is not exceeded in any given year.
I. In the event of
a discrepancy between a requirement of 3.3.14 NMAC and an existing New Mexico
regulation and licensing department or New Mexico taxation and revenue
department rule promulgated prior to 3.3.14 NMAC’s adoption, the existing rule
shall govern.
[3.3.14.8 NMAC - Rp,
3.3.14.8 NMAC, 7/16/2024]
3.3.14.9 APPLICATION:
A. To apply for a
state tax credit an applicant shall submit an application
for a certificate of eligibility to the division using either a
department-developed application or an approved electronic application system
as directed by the division director. The department will not accept paper
applications or applications submitted by e-mail unless specifically authorized
by the division. An applicant may obtain a state tax credit application form
and system installation form from the division.
B. An application
package shall include a completed state tax credit application form and written
attachments for a solar thermal system or photovoltaic system. To be considered
complete, an application must include the state tax credit application form and
any required attachments; partial applications will not be accepted. An applicant shall submit one application
package for each eligible solar energy system. After the department has
certified a solar energy system, applicants may not amend the certified
application package to seek additional credits for that system. If there are multiple owners of the property where
the solar energy system is installed, a joint application must be submitted.
C. The application
package shall meet the requirements of 3.3.14 NMAC. If an application package fails to meet a
requirement, the department shall disapprove the application.
D. The completed application form shall consist of the
following information:
(1) the
applicant’s name, mailing address, e-mail address, telephone number and the
last four digits of the applicant’s social security number or employer
identification number (EIN) provided by a business or agricultural enterprise;
(2) the
address where the solar energy system is located, if located at a residence,
business or agricultural enterprise, or a location description if located at an
agricultural enterprise;
(3) the
solar energy system’s type and description;
(4) the
date the solar energy system was installed;
(5) if
a contractor installed the solar energy system, the contractor’s name, address,
telephone number, e-mail address, license category and license number;
(6) acknowledgement
the applicant installed the solar energy system, if applicable;
(7) the
separately itemized net cost of equipment, materials, and labor of installing the
solar energy system, excluding the expenses and income listed in 3.3.14 NMAC;
and
(8) a
statement the applicant signed and dated, which signature may be a form of
electronic signature if approved by the department, agreeing that:
(a) all
information provided in the application package is true and correct to the best
of the applicant’s knowledge;
(b) applicant
understands that there is annual aggregate cap on available state tax credits
in place for solar energy systems and that they are eligible for a credit only
in the year the system was installed, or, in the case of systems installed in
2020, 2021, 2022 and 2023, tax year 2023;
(c) applicant
understands that the department must certify the solar energy system documented
in the application package before becoming eligible for a state tax credit;
(d) applicant
agrees to make any changes the department requires to the solar energy system
for compliance with 3.3.14 NMAC; and
(e) to ensure compliance with 3.3.14 NMAC,
applicant agrees to allow the department or its authorized representative to
inspect the solar energy system described in the application package at any
time after the date of submittal of the application package until three years
after the department has certified the solar energy system, upon the department
providing a minimum of five days’ notice to the applicant.
E. An application package
must contain the following information as attachments
(the requirements in the subparagraph below depend on solar energy system
location and whether application is seeking a state tax credit or a
supplemental state tax credit):
(1) A completed application package
for solar energy systems installed in years 2024 and after on private land
shall remit the following attachments:
(a) A current property tax bill or
other equivalent proof of ownership in the applicant's name for the residence, business,
or agricultural enterprise where the solar energy system is installed. All names, partnerships and titles listed as property
owners shall be listed on application;
(b) A Building Code Inspection report
including the name of the building code authority, the permit number, and the
date of successful inspection, either noted on a physical form, photo of
inspection sticker, or a web-based report. The department prefers the permit
for electrical inspection over the general building permit.
(c) An itemized invoice documenting
the equipment, materials, and labor costs of the solar energy system, including
but not limited to itemized accounting of permits, design, equipment, material,
categorized fees, and installation labor of the solar energy system. For
categorized fees please see Subsection C. of 3.3.14.14 NMAC; and
(d) The solar energy system’s design
schematic and technical specifications.
(2) The application package remitted
for solar energy systems installed in years 2024 and after on lands of a
federally recognized Indian nation, tribe or pueblo and held in leasehold by
that taxpayer shall consist of the following information provided as
attachments:
(a) A
leasehold agreement, trust, allotment of property or other equivalent proof that
the property where the solar system is installed is held on behalf of the individuals
applying. All names, partnerships and titles listed
as leaseholders shall be listed on application;
(b) For projects in areas subject to
a building code authority’s inspection: the permit number and issuance date,
and date of successful inspection, if applicable, noted on a physical form,
photo of inspection sticker, or a web-based report the applicable building code
authority approves. For projects in areas not subject to a building code
authority’s inspection, a certification from a licensed New Mexico electrician
that the solar energy system was properly integrated into the applicable
structure’s electrical system;
(c) An itemized invoice documenting
the equipment, materials, and labor costs of the solar energy system, including
but not limited to itemized accounting of permits, design, equipment, material,
categorized fees, and installation labor of a solar energy system. For
categorized fees please see Subsection C. of 3.3.14.14 NMAC; and
(d) The solar energy system’s design
schematic and technical specifications.
(3) The
application package for a supplemental state tax
credit for a project purchased and installed in years 2020 through 2023 shall
consist of the following information provided as attachments:
(a) a current property tax bill or
other equivalent proof of ownership in the applicant’s name for the residence, business,
or agricultural enterprise where the solar energy system is installed. All names, partnerships and titles listed as property
owners shall be listed on application;
(b) for projects on tribal lands: a leasehold
agreement, trust, allotment of property or other equivalent proof that the
property where the solar system is installed is held on behalf of the
individuals applying. All names, partnerships and
titles listed as leaseholders shall be listed on application;
(c) the equipment, materials, and
labor costs of a solar energy system the department certifies, documented in an
itemized invoice. The invoice shall itemize the following costs including but
not limited to permits, design, equipment, material, categorized fees, and
installation labor of a solar energy system. The department may accept a
purchase/installment agreement. For categorized fees please see Subsection C.
of 3.3.14.14 NMAC. If an applicant cannot obtain an itemized invoice for a
project installed in years 2020 through 2023, due to their contractor no longer
being in business, the department may accept at its sole discretion evidence of
project costs, such as evidence of total payments made and a certification that
such payments did not include otherwise excluded costs under categorized fees please see Subsection C. of 3.3.14.14 NMAC; and
(d) for projects in areas subject to
a building code authority’s inspection: the permit number and issuance date,
and date of successful inspection, if applicable, noted on a physical form,
photo of inspection sticker, or a web-based report the applicable building code
authority approves; and
(e) for projects in areas not subject
to a building code authority’s inspection, a certification from a licensed New
Mexico electrician that the solar energy system was properly integrated into
the applicable structure’s electrical system.
(f) the solar energy system’s design
schematic and technical specifications.
(4) In addition to the requirements in
the preceding paragraphs, if the application is for a solar thermal system, a
completed solar thermal list form that includes the:
(a) manufacturer or supplier of system
components and their model numbers;
(b) number of collectors;
(c) collector aperture dimensions;
(d) orientation of collectors by
providing the azimuth angle from true south and tilt angle from horizontal;
(e) SRCC solar collector certification
identification number; and
(f) manufacturer’s specifications for collectors
if collectors are unglazed;
(5) In addition to the requirements in the preceding paragraphs, if the
application is for a photovoltaic system, a completed solar photovoltaic list
form that includes the:
(a) manufacturer or supplier of major
system components and their model numbers;
(b) number of modules;
(c) module rated direct current power
output in watts under manufacturer’s standard test conditions;
(d) collectors’ orientation by providing
the azimuth angle from true south and tilt angle from horizontal;
(e) total inverter capacity in kilowatts
if an inverter is a part of the system;
(f) battery storage size and capacity in
kilowatts and kilowatt-hours, if battery storage is a part of the system; and
(g) the
building code authority’s permit number and issuance date, and date of
successful inspection, if applicable, noted on a physical form, photo of
inspection sticker or a web-based report the applicable building code authority
approves.
(6) Other information the department
needs to evaluate the specific system type for certification.
[3.3.14.9 NMAC - Rp,
3.3.14.9 NMAC, 7/16/2024]
3.3.14.10 APPLICATION REVIEW PROCESS:
A. The department shall
consider complete applications in the order received. If the department receives
multiple applications on the same day that would cumulatively exceed the
overall limit of state tax credit or supplemental state tax credit availability,
the department shall certify the first application received for the last
remaining tax credit.
B. The
department shall review the application package to calculate the state tax
credit or supplemental state tax credit; check the accuracy of the applicant’s
documentation; and determine whether the department shall certify the solar
energy system. The department shall disapprove an application that is not complete,
correct, or does not meet the approval criteria.
C. If the department finds the application package meets
3.3.14 NMAC’s requirements and a state tax credit or supplemental state tax
credit is available, the department shall certify the applicant’s solar energy
system and document the applicant as eligible for a state tax credit or
supplemental state tax credit, as appropriate. A certificate issue for a system
shall include the applicant’s contact information, the last four digits of their
social security number or EIN, system certification and the state tax credit
amount. If a state tax credit or
supplemental state tax credit is not available in the calendar year when the
application was submitted, the department will notify the applicant that the
program has reached the applicable aggregate tax credit certification cap and their application is not certified. The department
provides notification of credit unavailability through written notification to
the applicant.
D. The department shall
report to the taxation and revenue department the information required to
verify, process, and distribute each state tax credit or supplemental state tax
credit by providing a copy of the department’s certification notification.
E. The applicant
may submit a revised application package to the department; however, the division
shall place the resubmitted application in the review schedule as if it were a
new application unless the application is disapproved because the annual cap
has been reached.
F. If applicable,
the department’s disapproval letter shall state the reasons why the department
disapproved the application. The applicant may resubmit the application package
for a disapproved project, but it shall be reviewed as if it were a new
application.
[3.3.14.10 NMAC -
Rp, 3.3.14.10 NMAC, 7/16/2024]
3.3.14.11 SAFETY, CODES AND STANDARDS:
A. Solar energy
systems that the department may certify shall meet the following requirements:
(1) compliance with the latest adopted
version of all applicable federal, state, and local government statutes or
ordinances, rules or regulations and codes and standards that are in effect at
the time that the applicant submits the application package.
B. Solar thermal systems that the department may certify
shall meet the following requirements:
(1) design, permitting and
installation in full compliance with all applicable provisions of the latest New
Mexico Plumbing Code 14.8.2 NMAC, the New Mexico Mechanical Codes 14.9.2 NMAC,
Solar Energy Code 14.9.6 NMAC, the New Mexico General Construction Building
Codes, 14.7.2 to 14.7.7 NMAC and any amendments to these codes adopted by a
political subdivision that has validly exercised its planning and permitting
authority under Sections 3-17-6 and 3-18-6 NMSA 1978.
C. Photovoltaic systems that the department may certify
shall meet the following requirement for design, permitting and installation in
full compliance with all applicable provisions of the latest New Mexico
Electrical Code 14.10.4 NMAC and any amendments to these codes adopted by a
political subdivision that has validly exercised its planning and permitting
authority under Sections 3-17-6 and 3-18-6 NMSA 1978.
[3.3.14.11 NMAC - Rp,
3.3.14.11 NMAC, 7/16/2024]
3.3.14.12 MINIMUM SYSTEM SIZES, SYSTEM
APPLICATIONS AND LISTS OF ELIGIBLE COMPONENTS:
A. Solar energy
systems or their portions that the department may certify shall meet the
following requirements:
(1) be
primarily constituted by new equipment, components, and materials; except that
the department may certify a system with recycled or reused components if the
use of a used component would not adversely impact generation efficiency or
overall system longevity and so long as it is not otherwise ineligible for
certification;
(a) a
system that is on a recreational vehicle, is mobile, does not serve a permanent
end use energy load or is not permanently located in New Mexico;
(b) a
system that is not connected to a structure or foundation and does not serve a
permanent end use energy load or is not permanently located in New Mexico;
(c) a
system or portion of a system having one or more components not manufactured on
a regular basis by a business enterprise; and
(d) a
system or portion of a system that replaces a system or portion of a system the
department has certified in a previous application for a state tax credit.
B. The department may disapprove a system type, solar
thermal collector type, photovoltaic module type or a solar energy system
component if not listed in 3.3.14 NMAC for certification.
C. Solar thermal systems that the department may certify
include:
(1) the
system applications of solar domestic hot water, solar space heating, solar air
heating, solar process heating, solar space cooling or combinations of solar
thermal system applications listed in 3.3.14 NMAC;
(2) the
collector types of flat plate, parabolic trough, and evacuated tube; and
(3) the
listed component categories of collectors, pumps, fans, solar storage tanks,
expansion tanks, valves, controllers, and heat exchangers.
D. A solar thermal system component that the department may
certify is a photovoltaic system providing power for a solar thermal system
component’s incidental electricity needs. The department shall not certify such
a photovoltaic system as a separate solar energy system eligible for a separate
state tax credit.
E. Solar thermal systems or their components that the
department shall not certify are as follows:
(1) a
heating system or heating system components necessary for a swimming pool or a
hot tub;
(2) equipment
sheds, wall preparation, cabinetry, site-built enclosures, distribution piping
and associated installation costs;
(3) a
building design element used for passive solar space heating, space cooling, daylighting,
or other environmental comfort attribute;
(4) a
water quality distillation or processing system;
(5) in
a combined system, the portions of the system not allowed to receive a state
tax credit or for which the department shall not certify the system;
(6) A system that does not comply with
the latest version of the New Mexico Solar Code.
F. Solar thermal systems that the department may certify
shall meet the following requirements:
(1) minimum
system size of 15 square feet of solar collector aperture area;
(2) a
collector that is listed as certified by the SRCC by OG-100 collector
certification or OG-300 system certification processes; and
(3) all
components approved by an agency accredited by the American national standards
institute, if available for that specific component category.
G. Photovoltaic systems that the department may certify
include:
(1) the
system applications of direct power without battery storage, utility grid
interconnected without battery storage, utility grid interconnected with without
battery storage, stand-alone with battery storage, stand-alone with utility
backup capability and water pumping;
(2) the
flat plate module types of crystalline, poly-crystalline or thin-film amorphous
silicon;
(3) the
listed component categories of modules, inverters, batteries, manufactured
battery enclosures, charge controllers, power point trackers, well pumps,
racks, sun tracking mechanisms, performance monitoring equipment,
communications, datalogging or lightning protection; and
(4) disconnect
components, safety components, standard electrical materials, and standard
electrical hardware necessary for the assembly of the listed component
categories into a complete, safe, and fully operational system.
H. Photovoltaic systems that the department may certify
shall meet the following requirements:
(1) a
minimum total array power output of 100 watts direct current at manufacturer’s
standard test conditions;
(2) all
components listed and labeled by a nationally recognized testing laboratory, if
such listing is available for that specific component category; and
(3) an agricultural enterprise photovoltaic
system on a farm or ranch that is not connected to an electric utility
transmission or distribution system.
I. Photovoltaic systems
or their portions that the department shall not certify are as follows:
(1) a
commercial or industrial photovoltaic system that is not connected to an
electric utility transmission or distribution system;
(2) power
equipment sheds, wall preparation, cabinetry, site-built battery enclosures,
distribution wiring and associated installation costs;
(3) the
drilling, well casing, storage tanks, distribution piping, distribution
controls and associated installation costs of a water pumping system; and
(4) a
packaged product powered by photovoltaic cells that an applicant purchased
directly from a retail business enterprise, is not custom designed, and does
not require a permit from the building code authority for installation,
including gate or door openers, watches, calculators, walkway lights, and toys.
[3.3.14.12 NMAC – Rp,
3.3.14.13 NMAC, 7/16/2024]
3.3.14.13 CERTIFICATION:
A. The purpose of
the department’s certification program is to evaluate certification of complete
solar energy systems for state tax credit or supplemental state tax credit eligibility
that are composed of components and materials that are tested, certified,
approved or listed, as applicable, by other organizations identified or
referenced in 3.3.14 NMAC.
B. If
an applicant has received a state tax credit or a supplemental state tax credit
for a solar energy system under this part, the solar energy system may not be
used to meet the requirements for other tax credits available under state law:
(1) If the
2021 sustainable building tax credit application uses a solar energy system to
achieve the energy reduction performance rating, and that solar energy system was
previously certified for the state tax credit or the supplemental state
tax credit, the department shall disapprove the
application for that portion of a2021 sustainable building tax credit;
(2) if an
onsite solar system is used to meet the 2021 sustainable building tax credit
requirements of either the rating system certification level or the energy
reduction requirement, the applicant may not claim a state tax credit or supplemental
state tax credit under this part;
(3) a solar energy system may receive a state tax credit or
supplemental state tax credit new installation certification only once; and
(4) in the
case of an expansion to an existing solar energy system that previously
received certification as a new installation, the department may approve a
subsequent certification, but any credit issued shall cover only the costs of
the expansion portion of the solar energy system.
C. If, after the department has issued a
certification, any of these requirements are found to be insufficient, the
department may rescind the certification.
[3.3.14.13 NMAC - Rp,
3.3.14.14 NMAC, 7/16/2024]
3.3.14.14 CALCULATING THE SOLAR ENERGY
SYSTEM COST:
A. A state tax
credit or supplemental state tax credit shall be based on the equipment,
materials, labor, design fees, permitting inspection fees, design review stamp
and interconnections costs of a solar energy system the department has
certified. Self-installed systems shall be eligible for these costs, except
that self-installers may not claim their own labor but may claim labor they
hire.
B. The equipment, materials,
and labor costs of a solar energy system the department certifies shall be
documented in an itemized invoice. An invoice shall itemize the following costs
which include but are not limited to: permits, design, equipment, material,
categorized fees, and installation labor of a solar energy system.
C. The cost of a
solar energy system the department certifies shall be the net cost of acquiring
the system and shall not include the following:
(1) expenses,
including but not limited to:
(a) unpaid
labor or the applicant’s labor;
(b) unpaid
equipment or materials;
(c) land
costs or property taxes;
(d) costs
of structural, surface protection and other functions in building elements that
would be included in building construction if a solar energy system were not
installed;
(e) mortgage,
lease or rental costs of the residence, business or agricultural enterprise;
(f) legal
and court costs;
(g) research
fees or patent search fees;
(h) membership
fees;
(i) financing costs or loan interest;
(j) marketing,
promotional or advertising costs;
(k) repair,
operating or maintenance costs;
(l) warranty
or extended warranty costs;
(m) system
resale costs;
(n) system
visual barrier costs;
(o) adjacent
structure modification costs for building structures such as portals, garages, or
pergolas to hold solar panels, or costs for modification or roof repair to hold
solar panels;
(p) vegetation
maintenance costs including tree trimming;
(q) contractor or inspector travel, mileage,
or overnight hotel stays;
(r) recreational vehicle or hot tub
ports;
(s) trenching exceeding 50 feet;
(t) donations to food banks on the
applicant’s behalf;
(u) system critter guard;
(v) non-descriptive miscellaneous items;
and
(w) excess battery storage that is not consistent with
industry standards;
(2) income,
including:
(a) payments the solar energy system
contractor or other parties provide or receive that reduce the system cost,
including rebates, discounts, grants and refunds, except for federal tax credits;
(b) services,
benefits, or material goods the solar energy system contractor or other parties
provide by the same or separate contract, whether written or verbal.
D. The department
shall make the final determination of the net cost of a solar energy system the
department certifies pursuant to 3.3.14 NMAC.
[3.3.14.14 NMAC - Rp,
3.3.14.15 NMAC, 7/16/2024]
3.3.14.15 CALCULATING THE STATE TAX CREDIT OR supplemental state tax credit:
A. A state tax
credit or supplemental state tax credit to an applicant for a solar energy
system the department has certified shall not exceed:
(1) up
to ten percent of the purchase and installation costs
of a solar thermal or photovoltaic system as provided in 3.3.14.14 NMAC;
and
(2) six thousand dollars ($6,000) per taxpayer per taxable year.
B. The taxation and revenue department shall make the final
determination of the amount of a state tax credit.
[3.3.14.15 NMAC – N,
7/16/2024]
3.3.14.16 CLAIMING THE STATE TAX CREDIT OR supplemental state tax credit:
A. An applicant
shall apply for the state tax credit or supplemental state tax credit with the
taxation and revenue department and provide the department certification and
any other information the taxation and revenue department requires within 12
months following the calendar year in which the system was installed.
B. An applicant
claiming a state tax credit or supplemental state tax credit shall not claim a
state tax credit pursuant to another law for costs related to the same solar
energy system costs.
[3.3.14.16 NMAC – 7/16/2024]
3.3.14.17 INSPECTION OF SOLAR ENERGY SYSTEMS:
A. The only inspection
required through this application process for certification of an applicant’s
solar energy system are an inspection by the applicable building code authority
for building, electrical, or mechanical code compliance, as applicable to the
solar energy system type, if applicable. An applicant should be aware that
their electric utility company may require additional inspections for
photovoltaic systems that are interconnected to the distribution grid of that
electric utility company. The applicant is solely responsible for compliance
with such requirements.
B. For purposes of monitoring compliance with 3.3.14 NMC, the
department or its authorized representative shall have the authority to inspect
a solar system owned by an applicant who has submitted an
application for certification, upon the department providing five days’
notice to the applicant.”
[3.3.14.17 NMAC - Rp,
3.3.14.19 NMAC, 7/16/2024]
3.3.14.18 [RESERVED]
[3.3.14.18 NMAC - N,
8/25/2020; Repealed, 7/16/2024]
3.3.14.19 [RESERVED]
[3.3.14.19 NMAC - N,
8/25/2020; A, 12/13/2022; Repealed, 7/16/2024.]
HISTORY OF 3.3.14
NMAC:
Pre-NMAC History: None.
History of
Repealed Material:
3.3.14 NMAC - New
Solar Market Development Income Tax Credit, filed 8/25/2020 was repealed and
replaced with 3.3.14 NMAC - New Solar Market Development Income Tax Credit,
effective 7/16/2024.