New Mexico Solar Tax Credits: What You Need to Know
This post was last updated on November 19th, 2024
In 2016, solar tax credit bill was created to benefit Americans who needed to install solar panels. The law allows U.S citizens to install solar panels and claim back 30% of the total amount used while investing.
The period has been extended to 2022 so that there is enough time for people to move from electricity use to solar system. If you buy and install a solar system in 2019, you’ll claim a tax credit of 30%, but if you wait till 2020, the tax credit will have reduced to 26%. Therefore, it’s essential to take advantage of the New Mexico solar tax credits before 2022 comes.
Are You Eligible For The Solar Tax Credits?
If you own a solar system, you are eligible to claim the credits. But, if you lack tax liability, you won’t receive the 30% credit all at once. The amount will be spread over several years until you recover the whole amount.
Nonetheless, if you buy a solar panel in 2021 and you fall under the category of those without tax liability, you might not enjoy the New Mexico solar tax credits because the tax benefits are effective until 2022. Hence, it’s advisable to hire a solar panel installer now and enjoy the benefits before 2022.
Claiming Your Solar Tax Credits
Every year you file your federal tax return. If you install a solar system in August 2019, claim your solar tax credit when filing a federal tax return the following year.
Therefore, install a solar panel before 31st December 2019 and claim your credit in 2020. However, you must be the homeowner to install and earn tax credits; otherwise, if you are renting the space, you don’t qualify. Also, if you lease the solar panel, you don’t qualify either. However, if you hire, the installing company will still earn the tax credit.
When compiling your solar tax credit, include things like the shipping fee of the panel, installation fee, permit fee, among other expenses you pay from the beginning of the purchasing the panel.
Advantages of Solar Tax Credit
During the period between 2019 and 2022, homeowners and business owners will benefit from lower solar buying cost and installation.
A solar tax credit is encouraging homeowners to buy the solar system instead of leasing and enjoy the benefits of New Mexico solar tax credits. If you install a solar system worth of $10000 you qualify for $3000 tax credit.
Indeed, the U.S citizens will benefit and save a lot of money if they buy and install the solar panel system. The tax credit is reinstated back to your pension money, so add 30$ of solar tax credit to your pension amount.
Conclusion
Take advantage of the low prices of solar panel and install one. The good thing about the panel is that it will serve you for more than 25 years, and it provides sufficient energy to run your daily electricity consumption. It is important to note that if you lease the panel, the company that rents you the panel earns the 30% solar tax credits.
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