The federal solar tax credit in 2026: what changed
The homeowner credit is gone. Here is what is left.
The big change
The residential clean energy credit (Section 25D) does not apply to property placed in service after December 31, 2025. Buying a system in 2026 with cash or a loan does not earn it.
What is still around
The business solar credit (Section 48E) still exists, with new deadlines. Projects must begin construction by July 4, 2026, or be placed in service by the end of 2027. A company that owns a leased or PPA system can claim it.
What that means for you
With a lease or PPA, the owner can use the credit and pass some of the benefit on in the price. That is one reason third-party ownership is growing.
Business owners
If you own a commercial building, ask us what applies to your project and timeline. The deadlines matter.
Our advice
Do not assume any federal credit in your numbers. Ask us what applies today, and get it in writing.
Keep reading
- PPA vs solar lease: what is the difference?Both mean little or nothing down. Here is how they differ and who each one suits.
- Is paying cash for solar worth it in New Jersey?You own it, you keep the savings, and New Jersey stacks a few extras on top.
- Solar loans: how financing worksSwap your electric bill for a fixed payment, and own the system.