Disclosure: 1-800Deals is a contractor directory. We don't run any rebate program, and listings never change the facts on this page.
Short answer: The 30% federal solar tax credit for homeowners (the Residential Clean Energy Credit, section 25D) is gone for systems finished after Dec 31, 2025. The IRS counts the expense as made when installation is completed, so paying in 2025 for a system finished in 2026 doesn't qualify. In 2026, help comes from state and local incentives, net metering or export credit rules, and utility programs, which you can look up by state in DSIRE.
See what applies at your address. Enter your ZIP and the finder shows your state's rebate status and your local utility rebate lookups.
Find rebates by ZIP codeWhat changed
The One Big Beautiful Bill Act ended 25D early. Per the IRS FAQ: "The credit will not be allowed for any expenditures made after December 31, 2025," and an expenditure "is treated as made when the original installation of the item is completed." The same credit covered solar panels, solar water heaters, small wind, geothermal heat pumps, fuel cells and home batteries, so all of those lost the 30% credit at once.
| Your situation | Can you claim 25D? |
|---|---|
| System installed and finished in 2025 | Yes, on your 2025 return (Form 5695). No dollar cap except for fuel cells. |
| Paid or signed in 2025, finished in 2026 | No |
| Installed in 2026 or later | No |
| Unused 2025 credit (you owed less tax than the credit) | Carries forward to later years |
Source: IRS Residential Clean Energy Credit, IRS OBBB FAQ. Checked Oct 13, 2026.
What can still lower the cost of solar in 2026
| Incentive | Where it comes from | How to check |
|---|---|---|
| State tax credits or rebates | Some states | DSIRE by state |
| Property tax exemption for added solar value | Many states | DSIRE, county assessor |
| Sales tax exemption on equipment | Some states | DSIRE, state revenue department |
| Net metering or export credits | Your utility and state regulators | Your utility's interconnection page |
| Solar renewable energy credits (SRECs) | A few state markets | DSIRE, state program site |
| Utility or city rebates | Some utilities and cities | Utility site, our ZIP rebate finder |
We don't list amounts here because they vary by state and change often. DSIRE, run by NC State University, is the most complete free list.
Leases and power purchase agreements
With a lease or PPA, a company owns the panels and you pay for the system or its power. Business tax credits that the owner may claim follow different rules and deadlines than 25D. If a salesperson says your price includes a federal credit, ask in writing which credit, who claims it, and what happens to your price if it doesn't come through. We couldn't verify any single answer that applies to every company, so treat that claim as something to check.
Is solar still worth it?
Without the 30% credit, payback takes longer, so the math now leans on three things: your electric rate, how your utility credits power you send back to the grid, and your state incentives. Ask every installer for:
- A production estimate for your roof, with the shading assumption.
- Bill savings based on your own last 12 months of usage and your utility's actual export rate.
- The price before any incentives, and each incentive listed separately with its source.
Before solar, the cheaper wins are usually efficiency: sealing and insulating (attic insulation rebates), and checking utility energy efficiency rebates. If your income is limited, the free Weatherization Assistance Program can cut bills first.
Batteries and geothermal
Home batteries and geothermal heat pumps also lost 25D. A geothermal or air-source heat pump can still get state HEAR money where open; see heat pump rebates. For the parallel story on windows, insulation and heat pumps, read our 25C home improvement credit explainer. If your project needs a roof first, our directory lists local roofers and electricians who handle panel and wiring work.
Frequently asked questions
Is the 30% solar tax credit still available in 2026?
No. The Residential Clean Energy Credit doesn't apply to expenditures made after Dec 31, 2025, and the IRS treats the expense as made when installation is complete. Systems finished in 2025 can still be claimed on the 2025 return.
How did the 30% tax credit for solar work?
It was 30% of the cost of new solar equipment and installation labor for your home, with no dollar cap for solar. It reduced the federal tax you owed, and any unused amount carried forward to future years. It was claimed on Form 5695.
What tax credits are available for 2026 for home energy?
For homeowners, the main federal energy credits, 25C and 25D, have ended. State-run HOMES and HEAR rebates, state tax incentives and utility rebates are what's left. Check DSIRE and your state energy office.
Is solar worth it in 2026?
It can be, but it depends more on your utility's rates and export credit rules and your state's incentives than before. Get quotes based on your actual usage, and compare the price with and without each incentive.
Is the solar rebate changing in 2026?
The federal credit ended after 2025. State and utility programs change on their own schedules, so check DSIRE and your utility before you sign a contract.
Sources
- IRS: Residential Clean Energy Credit
- IRS: OBBB energy credit FAQs
- DSIRE incentive database
- U.S. DOE: Homeowner's guide to going solar
Amounts and statuses were checked Oct 13, 2026. Programs change often, so confirm with the program before you sign a contract. Where we couldn't verify a figure, we say so instead of guessing.
