46th legislature - STATE OF NEW MEXICO - first session, 2003

RELATING TO TAXATION; PROVIDING A TAX CREDIT FOR A SOLAR OR WIND ENERGY SYSTEM INSTALLED IN A RESIDENCE OR BUSINESS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. A new section of the Income Tax Act is enacted to read:

"[NEW MATERIAL] CREDIT FOR RESIDENTIAL SOLAR OR WIND ENERGY SYSTEMS.--

A. A taxpayer who is a resident of New Mexico, files an individual New Mexico income tax return and is not a dependent of another individual may claim a credit, not to exceed three thousand dollars ($3,000), in an amount equal to fifteen percent of the installed costs of a solar or wind energy system purchased by the taxpayer and installed in the taxpayer's primary residence in New Mexico between July 1, 2003 and June 30, 2013.

B. To be eligible for the credit provided by this section, the solar or wind energy system and the installation of the system must be warranted for a minimum of one year from the completion date of the installation of the system. The person selling the system and the person installing the system shall furnish the taxpayer with a written statement of the cost to the taxpayer and a written statement of the warranty.

C. The credit provided by this section may only be deducted from the taxpayer's New Mexico income tax liability for the taxable year in which the solar or wind energy system is installed. If the amount of the credit exceeds the tax liability of the taxpayer, the unused credit may be carried forward for not more than five consecutive taxable years. A taxpayer may not claim tax credits pursuant to this section exceeding in the aggregate three thousand dollars ($3,000) for the same residence.

D. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half of the credit provided by this section that would have been allowed on a joint return.

E. As used in this section:

(1) "solar or wind energy system" means a system or series of mechanisms designed primarily to produce electrical power or provide heating, by means of collecting and transferring solar- or wind-generated energy by active means, and includes only photovoltaic systems, wind-driven systems, solar domestic hot water systems or active solar space heating systems. "Solar or wind energy system" does not include a system used for the heating of a swimming pool, sauna or hot tub; and

(2) "installed cost" means the cost paid or incurred by the taxpayer for the purchase and installation of the solar or wind energy system, including purchase of an extended warranty on the system.

F. The energy, minerals and natural resources department may issue rules establishing eligibility standards for the credit provided by this section, including:

(1) minimum energy efficiency and other specifications for equipment and components of solar or wind energy systems;

(2) minimum warranty requirements for solar or wind energy systems; and

(3) installation standards and qualifications for persons installing solar or wind energy systems."

Section 2. A new section of the Corporate Income and Franchise Tax Act is enacted to read:

"[NEW MATERIAL] CREDIT FOR SOLAR OR WIND ENERGY SYSTEMS.--

A. A taxpayer that files a New Mexico corporate income tax return may claim a credit, not to exceed three thousand dollars ($3,000), in an amount equal to fifteen percent of the installed cost of a solar or wind energy system purchased by the taxpayer and installed in the taxpayer's business location in New Mexico between July 1, 2003 and

June 30, 2013.

B. To be eligible for the credit provided by this section, the solar or wind energy system and the installation of the system must be warranted for a minimum of one year from the completion date of the installation of the system. The person selling the system and the person installing the system shall furnish the taxpayer with a written statement of the cost to the taxpayer and a written statement of the warranty.

C. The credit provided by this section may only be deducted from the taxpayer's corporate income tax liability for the taxable year in which the solar or wind energy system is installed. If the amount of the credit exceeds the tax liability of the taxpayer, the unused credit may be carried forward for not more than five consecutive taxable years. A taxpayer may not claim tax credits pursuant to this section exceeding in the aggregate three thousand dollars ($3,000) for a single business location.

D. A taxpayer that claims a credit pursuant to this section for a business owned by a partnership or other business association of which the taxpayer is a member may claim a credit only in proportion to his interest in the partnership or association. The total credit claimed by all members of the partnership or association shall not exceed three thousand dollars ($3,000) for a single business location.

E. As used in this section:

(1) "solar or wind energy system" means a system or series of mechanisms designed primarily to produce electrical power or provide heating, by means of collecting and transferring solar- or wind-generated energy by active means, and includes only photovoltaic systems, wind-driven systems, solar domestic hot water systems or active solar space heating systems. "Solar or wind energy system" does not include a system used for the heating of a swimming pool, sauna or hot tub; and

(2) "installed cost" means the cost paid or incurred by the taxpayer for the purchase and installation of the eligible solar or wind energy system, including purchase of an extended warranty on the system.

F. The energy, minerals and natural resources department may issue rules establishing eligibility standards for the credit provided by this section, including:

(1) minimum energy efficiency and other specifications for equipment and components of solar or wind energy systems;

(2) minimum warranty requirements for solar or wind energy systems; and

(3) installation standards and qualifications for persons installing solar or wind energy systems."

Section 3. APPLICABILITY.--The provisions of this act apply to taxable years beginning on or after January 1, 2003.