TRD-41406: TRD-41406 New Solar Market Development Tax Credit Claim Form (2024)
New Mexico · New Mexico TRD · Used for tax years 2024
Form TRD-41406 is used to claim New Mexico’s New Solar Market Development Tax Credit against personal or fiduciary income tax. It reports the credit applied to tax owed, any eligible refundable amount, and unused credits carried forward from 2020 or 2021.
Who files this form
Use Form TRD-41406 to claim an EMNRD-certified new solar market development tax credit against New Mexico personal or fiduciary income tax.
The credit is available to taxpayers who:
- File a New Mexico personal or fiduciary income tax return for a tax year beginning on or after January 1, 2020.
- Purchase and install a qualified photovoltaic or solar thermal system on or after March 1, 2020, but before December 31, 2032.
- Install the system at a residence, business, or agricultural enterprise in New Mexico that they own. After May 15, 2024, the property may instead be owned by a federally recognized Indian nation, tribe, or pueblo and held in leasehold by the taxpayer.
You must obtain certification of eligibility from the Energy, Minerals and Natural Resources Department (EMNRD) before claiming the credit.
When it's due
For tax year 2024, the credit must be claimed for the taxable year in which you purchase and install the solar system. The form says you must apply within 12 months following the calendar year in which the system was installed.
The text does not provide a specific filing due date for the 2024 income tax return. It also warns that EMNRD will deny applications received after the annual cap has been met.
What you'll need
Attach these items to your New Mexico personal income tax return (PIT-1) or fiduciary income tax return (FID-1):
- A completed credit schedule, PIT-CR or FID-CR.
- Form TRD-41406, completed and signed.
- A copy of the EMNRD certification of eligibility approving the system and your credit.
- Schedule A if claiming an available carryforward from a credit initially approved for tax year 2020 or 2021.
- Schedule B if an approved business entity is allocating the credit to partnership or limited liability company members.
To complete Schedule A, you need the certificate/project number, approved tax year, approved credit amount, and amounts claimed in earlier years. For Schedule B, you need each member’s name, tax identification number, and ownership percentage.
How to file
- Obtain EMNRD certification before claiming the credit. For certification information, call the Energy Conservation and Management Division at (505) 476-3310 or visit https://www.emnrd.nm.gov/ecmd/.
- Enter your taxpayer and contact information, the beginning and ending dates of the claim’s tax year, and your net New Mexico income tax before credits.
- Enter the credit used to reduce your tax and any excess eligible for a refund. Complete Schedule A or Schedule B when applicable.
- Sign and date the claim, then attach it and the required supporting documents to your PIT-1 or FID-1 return.
You can sign in to Taxpayer Access Point (TAP) at https://tap.state.nm.us/Tap/_/ and follow the prompts to attach this form to your return. The supplied text does not give a mailing address for the claim.
For help completing the form or claiming the credit, call (505) 827-0792 or email BusinessCredit.Mgr@tax.nm.gov.
Common mistakes
- Leaving out required attachments. Failure to submit this claim form and a copy of the EMNRD certification with your return will result in denial of the credit.
- Applying more credit against tax than you owe. The amount used to reduce tax cannot exceed your net New Mexico income tax before withholding, payments, or credits.
- Including 2020 or 2021 carryforwards in a refund request. Those carryforwards are not refundable.
- Using new credit before older carryforwards. Apply credits in the order approved, using the oldest credit first.
- Listing a fully used credit on Schedule A. Do not include credits already claimed in full in earlier years.
Questions people ask
How much is the credit?
The credit is available for up to 10% of the purchase and installation costs, with a maximum credit of $6,000.
Can I receive a refund if the credit exceeds my tax?
The form allows a refund of eligible excess credit claimed starting in tax year 2022. Carryforwards from tax years 2020 and 2021 cannot be refunded.
How long can I use a 2020 or 2021 carryforward?
Unused credit may be carried forward for a maximum of five consecutive tax years following the tax year for which the credit was approved. Use Schedule A to calculate the remaining credit.
What if my spouse and I file separate returns?
If you could have filed a joint return, each spouse may claim only one-half of the credit that would have been claimed on the joint return.
Can a partnership or LLC allocate the credit to its members?
Yes. Complete Schedule B and allocate the credit in proportion to each member’s ownership interest. The total claimed by all members cannot exceed the credit approved on the EMNRD certificate.