Federal Solar Tax Credit Ended After 2025

What changed

Public Law 119-21, signed July 4, 2025, ended the credit for expenditures made after December 31, 2025. The old step-down through 2034 was removed because the credit now stops earlier.

Section 25D had allowed an individual a credit for qualified solar electric property, and for battery storage meeting the statute's terms, among other technologies. For property placed in service after December 31, 2021, the applicable percentage in the code is 30 percent. Public Law 119-21 amended subsection (h) so the credit does not apply to expenditures made after December 31, 2025. It also struck the later 26 percent and 22 percent years. The House of Representatives' U.S. Code compilation shows those amendments.

The IRS published FAQs on August 21, 2025, covering this change and several other energy provisions in the same law. The FAQ states that the residential clean energy credit will not be allowed for any expenditures made after December 31, 2025. That is the rule this page is describing. It is not our rule, and it is not something an installer can waive.

This site is not a government office. We do not process credits, and we do not tell you that you are entitled to one.

When an expenditure is 'made'

Section 25D(e)(8) treats an expenditure as made when the original installation is completed. Paying earlier does not move that date.

The IRS FAQ asks whether you can claim the credit for property installed after December 31, 2025, if you paid on or before that date. The answer in the FAQ is no. If installation is completed after December 31, 2025, the expenditure is treated as made after that date.

There is a different timing rule for expenditures connected with the construction or reconstruction of a structure: the FAQ says those are treated as made when you begin original use of the structure. If that use begins after December 31, 2025, the credit is not allowed under the FAQ's reading.

A salesperson who says 'you signed in 2025, so you are fine' is not citing this rule. Ask them to reconcile their sentence with section 25D(e)(8) and the IRS FAQ. Then ask a tax professional if any money depends on the answer. We will not reconcile it for a fee, because we are not your tax advisor.

Credits from earlier installations

The Congressional Research Service says Public Law 119-21 did not change the carryforward rules for a credit that was actually allowed.

If you completed a qualified installation in an earlier year and could not use the entire credit against your tax that year, carryforward is a feature of the old credit, not a new credit for a 2026 installation. CRS Insight IN12611 describes that distinction. Your return, your unused-credit worksheet, and your preparer are the record. We do not have them.

An amended return for a missed credit on a completed earlier installation is also a preparer question, with IRS deadlines. Do not take a blog's schedule as the deadline.

Leases, PPAs, and batteries

If you do not own the solar equipment, section 25D is not your credit. A battery you own is in the statute only when the expenditure itself is allowed.

Leases and power-purchase agreements leave ownership with a company. That company may have its own business tax position, including provisions that are not section 25D and that have their own dates and conditions. You cannot audit that position from a monthly payment. Do not let a lease be marketed as 'you still get the 30 percent.' You do not claim it.

Section 25D also lists qualified battery storage. The same expenditure-timing rule applies. A battery installed after the termination date is not rescued by being a battery. Batteries discusses the equipment without pretending there is a federal homeowner credit for a 2026 install.

State credits, utility tariffs, and local incentives are separate. Some exist, many have closed, and the amounts change. We do not quote them on this page because a stale dollar figure is worse than a warning to check the current document. They are not a federal credit, and they are not a reason to describe this website as a government offering.

What we will not put on your estimate

The calculator does not subtract a tax credit. The result is a bill-offset illustration only.

That omission is deliberate. Subtracting 30 percent from a price we do not know, under a credit that does not apply to a new 2026 installation, would be a false estimate. Savings and payback explains payback without that shortcut.

If you want a human to walk through a proposal, the estimate form is how you ask for a call. The person who calls is not from the IRS. They should not file your taxes. The consent checkbox is about contact, which is described on the TCPA consent page.