The proposed bill establishes a new income tax credit in New Mexico for taxpayers who purchase and permanently install backup power generators. This credit, referred to as the "backup power generator income tax credit," allows eligible taxpayers to claim a credit equal to fifty percent of the purchase and installation costs of the generator. The credit is available for taxable years prior to January 1, 2035, and applications for certification must be submitted to the energy, minerals, and natural resources department, which will issue a certificate of eligibility detailing the credit amount and taxable year. The total annual aggregate amount of credits that can be certified is capped at five million dollars.

Additionally, the bill outlines specific provisions regarding the allocation of the credit for married individuals filing separately and for taxpayers who own interests in business entities taxed as partnerships or limited liability companies. Any portion of the credit that exceeds a taxpayer's tax liability will be refunded. The bill also mandates that the credit be included in the tax expenditure budget and specifies that it will be repealed effective January 1, 2035. The provisions of the act will apply to taxable years beginning on or after January 1, 2025.