New Mexico SB 79: SOLAR MARKET DEVELOPMENT TAX CREDIT

Bill Text

SB 79
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AN ACT
RELATING TO TAXATION; CREATING THE SOLAR MARKET DEVELOPMENT
INCOME TAX CREDIT; REPEALING THE EXPIRED SOLAR MARKET
DEVELOPMENT TAX CREDIT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 7-2-18.14 NMSA 1978 (being Laws
2006, Chapter 93, Section 1, as amended) is repealed and a
new Section 7-2-18.14 NMSA 1978 is enacted to read:
"7-2-18.14. SOLAR MARKET DEVELOPMENT INCOME TAX
CREDIT.--
A. A taxpayer who is not a dependent of another
individual and who purchases and installs a solar thermal
system or a photovoltaic system in a residence, business or
agricultural enterprise after January 1, 2018 may apply for,
and the department may allow, a credit against the taxpayer's
tax liability imposed pursuant to the Income Tax Act in an
amount provided in Subsection C of this section. The tax
credit provided by this section may be referred to as the
"solar market development income tax credit".
B. The purpose of the solar market development
income tax credit is to encourage the installation of solar
thermal and photovoltaic systems in residences, businesses
and agricultural enterprises.
C. The department may allow a solar market

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development income tax credit in the following amounts of the
purchase and installation costs of a solar thermal or
photovoltaic system:
(1) if the system is installed prior to
January 1, 2023, up to ten percent of the purchase and
installation costs of the system; and
(2) if the system is installed on or after
January 1, 2023 and prior to January 1, 2028, up to eight
percent of the purchase and installation costs of the system.
D. The solar market development income tax credit
shall not exceed nine thousand dollars ($9,000). The
department shall allow a solar market development income tax
credit only for solar thermal and photovoltaic systems
certified pursuant to Subsection J of this section.
E. The department may allow a maximum annual
aggregate of five million dollars ($5,000,000) in solar
market development income tax credits per year. Completed
applications for the credit shall be considered in the order
received by the department.
F. A taxpayer may claim a solar market development
income tax credit for the taxable year in which the taxpayer
purchases and installs a solar thermal or photovoltaic
system. To receive a solar market development income tax
credit, a taxpayer shall apply to the department on forms and
in the manner prescribed by the department within twelve

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months following the calendar year in which the system was
installed. The application shall include a certification
made pursuant to Subsection J of this section.
G. That portion of a solar market development
income tax credit that exceeds a taxpayer's tax liability in
the taxable year in which the credit is claimed may be
carried forward for a maximum of five consecutive taxable
years.
H. Married individuals filing separate returns for
a taxable year for which they could have filed a joint return
may each claim only one-half of the solar market development
income tax credit that would have been claimed on a joint
return.
I. A taxpayer may be allocated the right to claim
a solar market development income tax credit in proportion to
the taxpayer's ownership interest if the taxpayer owns an
interest in a business entity that is taxed for federal
income tax purposes as a partnership or limited liability
company and that business entity has met all of the
requirements to be eligible for the credit. The total credit
claimed by all members of the partnership or limited
liability company shall not exceed the allowable credit
pursuant to this section.
J. The energy, minerals and natural resources
department shall adopt rules establishing procedures to

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provide certification of solar thermal and photovoltaic
systems for the purposes of obtaining a solar market
development income tax credit. The rules shall address
technical specifications and requirements relating to safety,
code and standards compliance, solar collector orientation
and sun exposure, minimum system sizes, system applications
and lists of eligible components. The energy, minerals and
natural resources department may modify the specifications
and requirements as necessary to maintain a high level of
system quality and performance.
K. A taxpayer allowed a tax credit pursuant to
this section shall report the amount of the credit to the
taxation and revenue department in a manner required by that
department.
L. The taxation and revenue department shall
compile an annual report on the solar market development
income tax credit that shall include the number of taxpayers
approved by the department to receive the credit, the