You Save Money, Pay No Gross Receipts Tax
Instead of having a sales tax, New Mexico has a gross receipts tax. You save when you buy a solar system because you don’t have to pay the gross receipts tax.
As you know from every time you go shopping, businesses pass along this tax along to you. You pay the tax.
Each year, New Mexico businesses are taxed on their gross receipts. The rate depends on location and may change. For example, as of May, 2017, the tax rate in Albuquerque was 7.3125%.
This tax may not seem like a lot of money to people when they buy a hamburger and fries. But a tax of 7.3125% tax on a $20,000 solar system is a lot of money: $1,462.50!
New Mexico makes solar systems exempt from this tax, so you enjoy big savings. You don’t pay the tax.
New Mexico State Tax Credit
Experienced Solar will assist in your application to apply for the Solar Market Development Tax Credit. We have experience with submittals and we will be here to help negotiate some of the issues we have encountered since the SMTDC was re-established.
Solar Market Development Tax Credit (SMTDC)
The Solar Market Development Tax Credit provides a tax credit of 10% for small solar systems, including on-grid and off-grid PV systems and solar thermal systems. The starting date for this tax credit is March 1, 2020, and the tax credit runs through December 31, 2027. There is a cap of $8 million in tax credits to be issued every year on a first-come first-serve basis.
Every installation owner is encouraged to submit an application to the office as soon as their system is fully connected and operational. Waiting to the end of the calendar year or until tax filing season may cause the loss of this tax credit.