2023 Solar Incentives Guide for Chaparral, NM - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Chaparral.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Chaparral?
Property Tax Exemption for Residential Solar Systems
Solar Energy Gross Receipts Tax Deduction
Geothermal Heat Pump Tax Credit (Personal)
Geothermal Heat Pump Tax Credit (Corporate)
Local Option - Renewable Energy Financing District/Solar Energy Improvement Special Assessments
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is designed to encourage more people to make the switch to renewable energy. Different kinds of incentives, including cash back, discounts or monthly utility bill credits, might be available to you. Some incentives may be offered by the New Mexico government, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:
- Tax Exemptions: Tax exemptions may come in one of two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when paying property tax on your house.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you've signed a net metering agreement with your Chaparral utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other places you may receive a refund equivalent to a percentage of the value.
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. Any rebates you receive will usually be deducted from the total price before tax credits are calculated.
Federal Solar Incentives
When people think of solar incentives, federal incentives are likely the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC provides you with a tax credit for a set percentage of your solar system's cost.
The ITC can be applied to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost — for panels, equipment, labor and accessories — although it may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.
Your local Chaparral solar panel installation expert can offer more information about the ITC and how it may apply to your situation.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. With the new provisions, solar installation projects started after January 1, 2022 and completed by the end of 2032 might qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the end of the current Clean Energy Credit in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. Your local Chaparral solar panel installation experts can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these can include tax credits, rebates and more. These incentives — which may be provided by your county or municipality, or by the state of New Mexico — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Chaparral
Solar energy use nationwide has gone up significantly in the last 15 years, in part thanks to the increase in availability of solar incentives. You might receive these incentives from the federal government, the New Mexico government or your local utility company. Talking to your local Chaparral solar panel installation company is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Chaparral, NM Solar Incentives FAQs
How can I learn if I qualify for different solar incentives?
Generally, solar incentives apply to:
- a new solar panel system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those given out by the New Mexico government or by your county/municipality, could have additional qualifications. Get in touch with your local Chaparral solar installer to discover what incentives your project will qualify for.
My home already has solar panels. Do I qualify for any incentives?
Your best bet is to talk to a representative from the company that installed your solar system — or speak to a local Chaparral solar installer — to better understand which incentives you might qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the best solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Chaparral.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to ensure that you are claiming incentives correctly and that you're getting the most money you can.
Can I use a combination of multiple types of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home — for example, a combination of solar and geothermal. You can also combine renewable energy generation with a backup source of non-renewable energy. Be sure to discuss your plan with your local Chaparral solar installation expert, to make sure you know what you'll need and what types of incentives you may or may not qualify for.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.