2023 Solar Incentives Guide for Las Cruces, NM - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Las Cruces.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Las Cruces?
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 phrase "solar incentives" refers to financial incentives that are in place to encourage people to use renewable energy by making installing and using solar panels more affordable. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered by the federal government, while others are offered by the state of New Mexico or by your utility company, county or municipality. Types of solar incentives might include:
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually come off your total price before tax credits are calculated.
- Net Metering: You may be able to sign a net metering contract with your Las Cruces utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your utility bill each month.
- Tax Exemptions: These may come in the form of property tax exemptions, which can 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.
Federal Solar Incentives
When people think of solar incentives, federal incentives may be the first thing that comes to mind. A federal incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a certain percentage of the cost of your solar system.
The ITC was originally for 30% of the total cost of installing a solar system, and has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Your local Las Cruces solar panel installer can offer more information about the ITC and how it applies to your situation.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar systems installed between 2022 and 2032. After this, the percentage will decrease slightly each year until the program expires in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, speak with your local Las Cruces solar installation company.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more might be available at a more local level. Incentives might be provided by your county or municipality, or by the state of New Mexico. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Las Cruces
Solar energy use nationwide has increased enormously in the last 15 years, in part thanks to the growth in the number of solar incentives. You might receive these incentives from the New Mexico government, the federal government or your local utility company. When you're prepared to switch over to solar energy, talking to your local Las Cruces solar panel installation expert is an excellent place to start.
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Best Warranty Coverage
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Las Cruces, NM Solar Incentives FAQs
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences fall under this distinction. Other solar incentives may be available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to better understand what incentives may apply to your specific situation.
What are some of the environmental benefits of switching to solar?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. Solar panels can also lower the CO2 emissions from your home by 500 pounds a year, or roughly 10,000 pounds over 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is slated to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I trade in my appliances for ones that use solar energy, are there benefits that I can claim?
Under the new Inflation Reduction Act, there are a number of new financial incentives to encourage you to 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 initial cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of your solar panels. Depending on which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to confirm that you are claiming the correct incentives and that you're getting the most money you can.
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.