Check your federal Investment Tax Credit eligibility by installation year, plus state bonus incentives and the net out-of-pocket cost of going solar.
⚠️ Federal ITC Expired December 31, 2025: The federal 30% residential solar tax credit (Section 25D) expired December 31, 2025 under the One Big Beautiful Bill Act. Homeowner-owned systems installed in 2026 or later do not qualify for this federal credit. If your system was fully installed on or before December 31, 2025, you may still be able to claim it on your 2025 taxes — consult a tax professional. State and utility incentives (see table below) are unaffected by this change. Full details in the FAQ below.
⚠️ Tax Disclaimer: This tool provides estimates for informational purposes only. Tax situations vary. Consult a qualified tax professional or CPA before filing. The ITC applies to your federal tax liability — not a refund if your liability is zero.
Enter Your Solar Project Details
Full installed cost from installer quote
Also eligible for the federal ITC if installed with solar by 12/31/2025
From your recent tax return (line 24)
Check your state's solar incentive page
Reduces ITC basis if it reduces purchase price
The federal ITC expired Dec 31, 2025 — only systems fully installed by then qualify. State credits are separate — see the table below.
Your Solar Tax Credit Summary
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Federal ITC
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State Credit
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Total Credits
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Net Out-of-Pocket
Credit Carryover Schedule
Tax Year
Tax Liability
Credit Applied
Credit Remaining
Carryover explained: If your ITC exceeds your tax liability in the installation year, the unused portion carries forward to future tax years — with no time limit under current law.
ITC Eligibility Checklist
These rules apply only to systems that were fully installed on or before December 31, 2025 — the federal ITC is not available for systems installed in 2026 or later. See the disclaimer above.
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New installation only
The 30% ITC applies to new solar panels and battery systems installed on a U.S. property. Previously installed systems do not qualify.
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Primary or secondary residence
Qualifying properties include your main home, a vacation home, or even off-grid solar on land you own. Pure rental properties use a different depreciation path (IRS Form 3468).
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You own the system — not leased
If you lease solar or use a PPA (Power Purchase Agreement), the tax credit goes to the leasing company, not you. To claim ITC you must own the system outright or via a solar loan.
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Battery charging-source rule (2023–2025 installs)
Standalone battery storage added from 2023 through Dec 31, 2025 was ITC-eligible at 30% regardless of charging source. Batteries installed before 2023 had to be charged exclusively by solar to qualify. This entire ITC pathway ends for systems installed in 2026 or later.
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You must have federal tax liability
The ITC reduces dollar-for-dollar what you owe in federal income taxes. If your tax liability is $0, you cannot use the credit that year — but it carries forward to future years when you do owe taxes.
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File IRS Form 5695
Claim the credit on IRS Form 5695 (Residential Energy Credits) and attach to your Form 1040. Your solar installer should provide documentation of total system cost.
Notable State Solar Incentives (2026)
These state and utility programs are separate from the federal ITC and are unaffected by its December 31, 2025 expiration. The table below highlights some of the most valuable programs — check your state's energy office for current details.
State
Program
Benefit
New York
NY-Sun / State Tax Credit
25% state credit (up to $5,000) + NYSERDA rebates
Massachusetts
SMART Program + State Credit
15% state credit (up to $1,000) + production payments
Maryland
CleanEnergy Grant
$1,000 residential grant + property tax exemption
New Jersey
SuSI Program
Successor solar incentive + 4% sales tax exemption
South Carolina
SC Tax Credit
25% state credit (up to $3,500)
Arizona
AZ Residential Credit
25% state credit (up to $1,000) + sales/property tax exempt
Connecticut
PACT Program
Bill credits + zero interest PACE financing
California
SGIP Battery Rebate
$150–$1,000/kWh for qualifying battery storage
Texas
No state income tax
No state income tax (ITC less relevant) + property tax exemption
Colorado
RENU Loan / XCEL Rebate
$500–$1,500 utility rebates + low-interest state loans
Always verify: State programs change frequently. Visit your state's energy office or the DSIRE database for the most current incentive information.
Federal ITC FAQ
The federal ITC expired December 31, 2025. The answers below explain how the credit worked for systems installed on or before that date.
How long is the 30% ITC available?
It's no longer available for new homeowner installations. The federal residential solar tax credit (Section 25D), previously scheduled under the Inflation Reduction Act to run at 30% through 2032 before stepping down to 26% in 2033 and 22% in 2034, was terminated early by the One Big Beautiful Bill Act (signed July 4, 2025). It expired December 31, 2025 — that step-down schedule no longer applies. Systems fully installed on or before December 31, 2025 could still claim the 30% credit on 2025 taxes, with no retroactive clawback for anyone who already claimed it. Systems installed January 1, 2026 or later do not qualify for this federal credit. Separately, a business-side credit (Section 48E) remains available through 2027 for third-party-owned systems (solar leases and PPAs) — but that credit goes to the leasing company, not the homeowner.
Is the ITC a rebate or a tax credit?
It is a non-refundable tax credit — it reduces your federal income tax bill dollar-for-dollar. If you owe $10,000 in taxes and have an $8,400 ITC, you pay only $1,600. It is NOT a refund check mailed to you if you owe nothing.
What costs are included in the ITC basis?
Labor costs, solar panels, inverters, racking and mounting, wiring, battery storage (if charged by solar), permit fees, and inspection costs all count toward the ITC basis. Roof repairs done separately from the solar installation typically do not qualify.
Can I claim the ITC if I finance with a solar loan?
Yes. As long as you own the system (not a lease/PPA), financing method doesn't matter. The full system cost is your ITC basis — not just the down payment. Many solar loans are structured to let you pay down the principal with your ITC refund.
Do utility rebates reduce my federal ITC?
It depends. Rebates from your state government do NOT reduce your ITC basis. But rebates paid by your utility company ARE treated as a reduction in your system's purchase price, which reduces your ITC calculation. Our calculator handles this automatically.