New Mexico Incentives

Visit New Mexico state’s website for the latest information.

New Mexico offers tax credits and rebates for residents through several programs:

  • Inflation Reduction Act Rebates for low-income New Mexicans
  • Sustainable Building Tax Credit*
  • Clean Cars Tax Credit*
  • Solar Market Development Tax Credit

*You may be eligible for some tax credits even if you do not pay state taxes. Remember to add on Federal, electricity provider and other incentives too!

Additional Resources for Low-income New Mexicans

 

Inflation Reduction Act (IRA) Rebates

There are two IRA Rebate programs.  In New Mexico, these are for low-income households, with incomes less than 80% of the Area Median Income or participation in certain programs. See if you qualify.

    • The Home Electrification and Appliance Rebates (HEAR) offers coupons or rebates for a range of products obtained through participating retailers and/or contractors.
The state is rolling these out in phases, so not all rebates may be available now. DIY insulation (up to $1,600) heat pump clothes dryers ($840)  and induction stoves and ranges ($840) were introduced in 2024.  Stay tuned for more including air leak sealing, heat pumps, heat pump water heaters, and electric panel and wiring upgrades. 75% of rebates are for single-family homes and 25% for multi-family dwellings. You can purchase multiple items at different times, with a maximum rebate of $14,000 per address. See the website for more information.
    • The Home Energy Rebates (HER) will cover home energy efficiency upgrades based on lowering the overall energy use of the home.
Sustainable Building Tax Credit (SBTC)

These credits are for doors, windows, air- and ground-sourced heat pumps, heat pump water heaters, insulation improvements and EV charger installation. Higher credits are given to low income residents or installations made in affordable housing.  Tax credit is refundable for residents with incomes <200% of the Federal Poverty Level.

Use the SBTC to:

  • Install energy-conserving products in an existing residential or commercial building.
  • Construct a new residential or commercial building that qualifies for Build Green New Mexico or LEED (Leadership in Energy and Environmental Design) certification.
  • Renovate a commercial building to reduce total energy and power costs by 50%.
These credits are available to individual homeowner and business taxpayers (including landlords). You must apply for a certificate from Energy, Minerals and Natural Resources which you will need to file for the  tax credit later. There are annual caps on the amounts available each year, and the certificates are given out on a first-come, first serve basis, so apply for your certificate as soon as your project is complete, and the earlier in the year the better. Don’t wait until tax time the following year! For installing energy conserving products use these instructions and apply in this portal.Once you receive your certificate, use it and this form to apply for the credit at tax time.

  • Low Income is defined as having income below 200% of the Federal Poverty Line, which changes every year. If you qualify as low-income, the tax credit is refundable, meaning, the maximum credit amount will be refunded to you even if you don’t owe any state taxes.  If you bought a heat pump water heater for example, you would receive $700 back at tax time.
  • For everyone else,  SBTC is non-refundable. You can only get back what you owe in taxes, but this can be carried over a 7 year period.  So for example, say you spent $8,000 on a heat pump in 2025, and you owe $600 in taxes that year, you would get back $600 of the maximum allowable $1,000 credit for 2025. In 2026 you could carry over the remaining $400.  So if you again owe $600 in 2026 you would receive a $400 refund.

 

 

Clean Cars Tax Credit
These are the tax credits for new, used and leased (min 3 year lease) vehicles, which must be purchased or leased through a dealer licensed by the New Mexico motor vehicle division, or a located on tribal land within New Mexico (e.g., Tesla).
    • The MRSP must be $55,000 or less for new and $25,000 or less for pre-owned, which must also be at least 2-years old.
    • You are eligible even if you do not pay state taxes. You may add this on top of a Federal clean car tax credit. 
    • To get the tax credit first  apply here for a Certificate of Eligibility from the state after you purchase or lease the car. For that you may need electronic copies of:
        • Your Registration
        • Vehicle Sticker
        • Signed bill of sale or purchase/lease agreement
        • Spec sheet specifying weight, battery capacity and range
        • If the vehicle is owned by multiple parties, they all must electronically sign on the last page of the application
        • Then file the certificate with your taxes using form TRD-41419 Clean Car Tax Credit Claim Form

We hope that the Legislature will pass a bill in 2025 to allow Dealers to accept the state tax credit (like the Federal one) at the point of sale for an immediate discount. 

EV Chargers

The program also offers a tax credit toward the purchase and installation of qualifying EV charging equipment, and for the installation of charging units connected to electric facilities needed to serve their electric vehicle charging equipment. Alternatively there is tax credit for EV chargers in the Sustainable Building Tax Credit.

Solar Market Development Tax Credit (SMDTC)

This tax credit is available to businesses and homeowners for solar equipment and installation. Solar systems installed on or after March 1, 2020 are eligible for a tax credit of 10%, up to $6,000. This is a great opportunity to lower energy bills, protect the environment, increase the value of your home, and save money at tax time!

Solar Tax Credit Dashboard shows how much funds are available, the number of projects per county, average taxpayer annual energy cost savings  and other statistics.

The solar tax credit annual allotment was raised to $30 million from $12 million, thanks to SB 121.  As soon as your project is complete, visit here to apply for a Certificate that you will need in order to file your taxes to claim the credit.  Applications are first come first served.  For systems installed on private land you will need:

    • A current property tax bill or other equivalent proof of ownership in the applicant’s name for the residence, business, or agricultural enterprise. All names, partnerships and titles listed as property owners shall be listed on application.
    • A Building Code Inspection report. The department prefers the permit for electrical inspection over the general building permit.
    • An itemized invoice documenting the equipment, materials, and labor costs of the solar energy system, including but not limited to itemized accounting of permits, design, equipment, material, categorized fees, and installation labor of the solar energy system. For categorized fees, see Subsection C. of 3.3.14.14 NMAC.
    • The solar energy system’s design schematic and technical specifications; and
    • Site plan, which is a bird’s eye view of solar system design.
    • One-line or three-line electrical diagram showing wiring connection

IF YOUR APPLICATION WAS REJECTED  in 2020-2023 because the annual cap had been reached, you will be able to apply for the credit again in 2024. 

Contact EMNRD for instructions regarding a solar thermal system.
  • Lower energy bills. The estimated average annual energy cost savings for a New Mexico taxpayer is $1,616 (based on a statewide average of $0.12 per kWh).
  • Increase home value. According to a large scale study by the Department of Energy’s Lawrence Berkley Laboratory, home buyers are consistently willing to pay more for homes with solar energy systems. Despite increased home value, New Mexico does not add this value to your property taxes.
Additional resources:

Solar For All for Low-Income Households

Solar for All is a U.S. Environmental Protection Agency (EPA) program designed to make solar power available to low-income households.  New Mexico was awarded a $156 million to fund solar systems for households that otherwise might not be able to access this clean, renewable form of energy.  The program will be available in NM May 1, 2025, unless the new US administration “claws back” funding.

 

Community Energy Efficiency Development (CEED) Program

(CEED) Block Grant Act was passed in 2022 to provide grants for targeted residential energy efficiency improvements in underserved communities across New Mexico.

Be on the lookout for the first batch of  CEED programs implemented by these counties and  municipalities.

Housing NM 

Programs including it’s Home Rehabilitation, Weatherization and Veteran’s programs for low-income residents.

Also check out our Resources for Low-income Residents page.