2023 Solar Incentives Guide for Gallup, NM - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Gallup.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Gallup?
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
The term "solar incentives" broadly refers to financial incentives designed to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. You might be eligible for different types of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the New Mexico government and others from the federal government. Categories of solar incentives include:
- Tax Exemptions: These may come in the form of property tax exemptions, which let you exclude the value of your solar system when paying property tax on your house. You may also qualify for an exemption on sales tax at the time of purchase.
- Net Metering: You may be able to sign a net metering agreement with your Gallup utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. These may be offered by your local utility company, your county or your state. The rebates are usually applied before calculating tax credits.
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides a tax credit for a predetermined percentage of the cost of your solar system.
The ITC can be applied to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006 on a property owned by you for you to claim the credit. The ITC initially covered 30% of all system installation costs (panels, labor, equipment and accessories), although this amount has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
Your local Gallup solar panel installer can offer more information about the ITC and how it might apply to your situation.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then decrease yearly until the Clean Energy Credit expires in 2035. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Gallup solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Rebates, tax credits and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Some incentives are offered for only a limited time, while others are ongoing. Your local incentives may come from your county or municipality, or from the New Mexico government.
Next Steps for Installing Solar in Gallup
Solar incentives may be provided by the federal government, the New Mexico government or your local utility company. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Speak with your local solar panel installer today to find out more information and to save the most money possible on a solar system for your Gallup home.
EcoWatch's Gallup, NM Solar Incentives FAQs
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