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
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated September 15, 2023
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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
Source: https://www.dsireusa.org/
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
What if I add a solar system to a rental property, vacation home or commercial property? Do I still qualify for incentives?
Many solar incentives apply to a property you own that is located within the United States, and most secondary residences fall into this category. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives apply to your specific situation.
If I installed solar panels on my house a few years ago, can I still claim incentives?
Your best bet is to talk to the company that installed your solar panels — or get in touch with a local Gallup solar installer — to clarify which incentives you may qualify for. If your solar panels were 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%.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly called the federal solar tax credit, or ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I trade in my appliances for ones that can use solar energy, are there any benefits that I can claim?
With the passage of the new Inflation Reduction Act, there are a variety of new financial incentives that are available when you make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied could vary depending on which incentives you are eligible for but typically yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to ensure you are claiming all possible incentives and applying them in the correct order.
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.