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Federal incentives · status verified 2026-08-21

Federal solar tax credit in 2026

The 30% residential clean energy credit is gone for 2026 installations. Here is exactly what changed, what still applies, and what to check before you model any federal benefit into your price.

Residential Clean Energy Credit (IRC §25D)

Expired for 2026

What it was: 30% of qualifying solar (and battery) costs, no dollar cap, for homeowner-owned systems placed in service 2022–2025.

What happened: The One Big Beautiful Bill Act (signed July 4, 2025) repealed §25D for property placed in service on or after January 1, 2026 — no phase-down, no transition period.

If you installed in 2025: you can still claim 30% on your 2025 federal return via IRS Form 5695. The credit is non-refundable; unused amounts carry forward. Filing deadline April 15, 2026 (extended to Oct 15, 2026 with extension).

If you buy in 2026: $0 federal credit for owned systems — cash or loan. Do not let a quote “include the 30% federal credit.”

Source: IRS Residential Clean Energy Credit guidance; One Big Beautiful Bill Act (H.R. 1, 119th Congress). Last checked 2026-08-21.

Clean Electricity Investment Credit (IRC §48E) — commercial / third-party owned

Available with deadlines

Rate: 30% base investment tax credit on qualifying project costs.

Deadlines: solar generally must be placed in service by December 31, 2027; projects that began construction by July 4, 2026 may use a longer completion window. Storage remains eligible through 2033 with a phase-down after.

Sourcing rules: FEOC/PFE restrictions apply from 2026 — the supply chain matters for eligibility.

Lease/PPA note: the homeowner does not claim this credit — the system owner does, and may price part of the benefit into your rate. That is a real but indirect benefit.

Source: IRS §48E; One Big Beautiful Bill Act; final FEOC/PFE regulations. Last checked 2026-08-21. Not tax advice — confirm with a qualified tax professional.

Energy storage under §48E

Available (commercial/3rd-party)

Standalone or paired storage (minimum ~5 kWh) is eligible for the §48E credit for projects beginning construction through 2033, with phase-down after — subject to the same sourcing rules. For a homeowner-owned battery in 2026: no federal credit (§25D is gone). State battery programs (CA, NY, MA, CO and others) may still help — see the incentive finder.

What this means for your price

Before 2025, buyers modeled “gross price minus 30%.” In 2026 that subtraction is zero for owned residential systems. Your net cost now equals gross price minus verified state and local incentives only. This is one of the biggest single changes in US residential solar — and the reason this site tracks incentive status explicitly. See the incentives guide for the full picture.