Data sourced from the U.S. Dept. of Energy, Energy Star, and the EIA.

Is There Still a Federal Solar Tax Credit in 2026?

The 30% residential solar tax credit ended for expenditures made after 31 December 2025, and an expenditure counts as made when installation is completed. What that means for 2026 quotes, what still exists, and where to look for state and utility incentives.

By TrimWatt Editorial Teamwho we arePublished July 22, 2026Verified July 31, 20267 min readNot yet independently reviewed — how we review
Key takeaways
  • The federal 30% Residential Clean Energy Credit (Section 25D) terminated for expenditures made after December 31, 2025.
  • For solar, an expenditure counts as made when installation is completed — not when you ordered, signed a contract, or paid a deposit.
  • The related 25C heat pump credit ended the same date but under a different test: property placed in service, not expenditure made.
  • State, local and utility incentives may still apply — the DSIRE database is the standard place to check what applies at your address.
  • This is not tax advice — confirm your position with the IRS or a qualified tax professional before relying on it.
A home with rooftop solar panels beside a simple tax-credit document symbol.
On this page
  1. What changed
  2. What this does to the payback math
  3. What still exists
  4. How to check your own situation
  5. What to do next

If you're reading a 2026 solar quote that subtracts 30% for a federal tax credit, the quote is out of date. The residential credit that made that arithmetic work no longer applies to systems whose installation is completed this year.

Data current as of July 2026
Tax rules change, and your own circumstances affect whether a credit applies to you. Check the current IRS guidance linked in our sources, or speak to a qualified tax professional, before you rely on any of this for a filing decision.

What changed

The Residential Clean Energy Credit under Section 25D — the 30% credit homeowners claimed for solar, batteries, and similar property — was terminated for expenditures made after 31 December 2025 by the law enacted on 4 July 2025. The Energy Efficient Home Improvement Credit under Section 25C, which covered items such as heat pumps up to $2,000, ended on the same date, but through a different test: 25C turns on property placed in service after 31 December 2025, while 25D turns on expenditures made after that date.

For solar, the dividing line is when installation was completed
Section 25D ends for expenditures made after 31 December 2025, and Section 25D(e)(8)(A) treats an expenditure as made when the original installation of the item is completed. The IRS has confirmed that if installation is completed after 31 December 2025, the expenditure counts as made after that date and the credit is not available — so paying for equipment in 2025 does not help if the install finished in 2026. If your installation was completed on or before 31 December 2025, the credit applies to that tax year.

What this does to the payback math

Removing a 30% credit doesn't make solar unviable, but it does lengthen payback materially for a purchased system, because the credit was subtracted from the upfront cost rather than spread across the years. Any payback figure you were quoted in 2025 needs recalculating from the full installed price.

Our Solar Savings Calculator estimates from the installed cost without assuming a federal credit, so the figure it returns is the un-subsidised starting point. Add any state or utility incentive you actually qualify for on top of that.

What still exists

  • State income tax credits, rebates, and property or sales tax exemptions, which vary by state.
  • Utility rebates and performance incentives in some service territories.
  • Net metering or net billing rules, which often matter more to lifetime economics than any one-off rebate.
  • Third-party ownership products (leases and PPAs), where the company owning the system claims the business-side credit rather than you — evaluate these on the contract terms, not on a credit you won't claim.

How to check your own situation

  1. Search your state and utility in the DSIRE database for currently active programmes.
  2. Ask any installer to show a quote with no federal credit line, so you see the real number.
  3. Confirm your net metering terms with your utility — future rate changes affect lifetime value more than most rebates.
  4. Take the final figures to a tax professional before assuming any credit applies to you.
This is not tax advice
Tax rules are specific to your circumstances and change. Use the IRS pages linked in our sources and a qualified professional rather than a website — including this one — as the basis for a filing decision.

What to do next

If a salesperson is still quoting the 30% federal credit for a 2026 installation, treat it as a signal about the quality of the rest of the quote. Ask for the numbers again without it, then compare against your state's actual programmes.

What these numbers assume — and where they stop

Assumptions

  • This covers the residential credit claimed by homeowners on their own tax return (Section 25D), not commercial credits claimed by a company that owns the system.
  • Eligibility turns on when the expenditure was made. Under Section 25D(e)(8)(A), an expenditure is treated as made when the original installation of the item is completed — not when you ordered the system, signed a contract, or paid a deposit.

Limitations

  • We are not tax advisers and this is not tax advice. Confirm your position with the IRS guidance or a qualified tax professional before relying on it.
  • Third-party ownership arrangements (leases and power purchase agreements) are treated differently from a system you buy outright, because the company — not you — owns the equipment.
  • State and utility programmes change frequently and vary enormously; only your own state's current listing is authoritative.

Sources

Frequently asked questions

Can I still claim the 30% solar credit in 2026?

Not for a system whose installation was completed in 2026. The credit terminated for expenditures made after 31 December 2025, and an expenditure counts as made when the original installation is completed. If your installation finished on or before that date, you would claim it on the corresponding tax return — paying a deposit or signing a contract in 2025 is not enough on its own.

Did the heat pump credit end too?

Yes, on the same date and under the same law — but through a different test. The Energy Efficient Home Improvement Credit (Section 25C), which covered heat pumps up to $2,000, ended for property placed in service after 31 December 2025, whereas Section 25D ends for expenditures made after that date.

Are there any incentives left for home solar?

Potentially, at state, local, and utility level — and net metering rules still affect the economics. The DSIRE database is the standard place to check what applies at your address.

Run the numbers yourself