Solar incentives
Solar Incentives and Rebates
Incentives arrive in four layers, and they do not all apply to the same people. Eligibility turns on ownership, tax position, utility, equipment and timing, so the credit your neighbour claimed may not be one you can.
Current position — reviewed
The federal residential credit has ended
Section 25D, the 30% residential clean energy credit, was terminated for expenditures made after 31 December 2025. It did not phase down and it was not left to lapse — the 2025 budget act struck the end date out of the statute and deleted the scheduled step-downs to 26% and 22%.
Source: Public Law 119-21 § 70506, enacted 4 July 2025, read from the enrolled text at the Government Publishing Office, against 26 U.S.C. § 25D (United States Code, 2024 edition). Read 3 September 2026.
If you are reading a proposal, a savings estimate or an article that subtracts 30% from an owner-occupier's price, it is working from rules that no longer apply. Third-party-owned systems — leases and power purchase agreements — sit under Section 48E, a business credit claimed by the owner of the equipment rather than by you.
What the statute actually says Why a lease still gets a credit
How incentives stack
Four layers, four administrators
Solar incentives do not come from one place. They come from four, each with its own rules, its own dates and its own way of running out. Eligibility for one tells you nothing about the others.
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Federal
Congress, administered through the IRS
What it looks like. Tax credits claimed on your federal return.
Where it stands. Section 25D, the residential credit, was terminated for expenditures made after 31 December 2025. Section 48E, a business credit, continues to apply to third-party-owned systems on its own timetable.
How to verify: The statute and IRS guidance. Our two federal pages cite the enacted text.
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State
State legislature, energy office or revenue department
What it looks like. Income tax credits, rebates, sales tax exemptions, property tax exemptions, and performance payments.
Where it stands. Varies enormously and changes often. Some states offer nothing; some offer several stacked programmes. Property and sales tax treatment are the most widespread and the least publicised.
How to verify: Your state energy office and revenue department directly. State programmes frequently have annual budgets that exhaust before the year ends.
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Utility
Your electricity provider
What it looks like. Rebates, performance-based incentives, battery programmes and demand response payments.
Where it stands. Set by the utility, not the state, so two neighbours on different utilities can face completely different offers. Cooperatives and municipal utilities set their own terms and are often outside state mandates entirely.
How to verify: Your utility, by name, in writing. This is the layer most often assumed rather than checked.
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Local
County, city or municipality
What it looks like. Permit fee waivers, small rebates, expedited permitting, and property tax arrangements.
Where it stands. Small in dollar terms and easy to miss. Expedited permitting can be worth more in time than the rebate is in money.
How to verify: Your local building department and county assessor.
Why we do not publish a programme table
You will find sites listing every state and utility incentive with an amount next to it. We do not, because we could not keep it true. State budgets exhaust mid-year, utilities close programmes at short notice, and a table that is 80% current reads as 100% current to whoever finds it.
What we publish instead is the federal position with its dates and the statute behind it, the structure above, and the questions below. The incentive finder filters by location; anything it surfaces should still be confirmed with the body that administers it.
Before you count on it
Seven questions for any incentive
Ask these about every programme a salesperson includes in a savings figure. Most disappointment comes from the second one.
- Is this a tax credit or a rebate?A credit reduces tax you owe, later. A rebate reduces what you pay, often now. They are not interchangeable and they have different cash-flow consequences.
- Do I have the tax liability to use it?A non-refundable credit is worth nothing beyond the tax you actually owe. This is the assumption that most often fails.
- What is the effective date?Both the start and the end. Some programmes bind on contract signature, some on expenditure, some on the date the system is energised.
- Is there a budget cap?Rebate programmes routinely exhaust their annual allocation before the year ends, and close without notice.
- Who claims it?Under a lease or PPA the third party owns the equipment and claims the credit. Whether any value reaches you depends on the contract.
- What is the equipment requirement?Some programmes require specific certifications, domestic content, or an approved installer list.
- What happens if I sell?Some incentives carry a clawback or a holding period. Ask before signing, not after listing.
HyreSolar is not a tax adviser. Whether any credit or deduction applies to you depends on your own circumstances, and you should confirm it with a qualified professional and with the body administering the programme before relying on it.
Federal
Tax credits, and the dates attached to them.
Export compensation
What the utility pays for the electricity you send back.
State and local
Property tax, sales tax and access rights vary state by state.
Find what applies to you
Filtered by location rather than listed nationally.
Common questions
- Is the 30% federal solar tax credit still available?
- Not for homeowners buying their own system. Section 25D, the 30% residential clean energy credit, was terminated for expenditures made after 31 December 2025. It did not phase down — the 2025 budget act struck the end date and deleted the scheduled step-downs. Third-party-owned systems sit under Section 48E, a business credit on a different timetable.
- Why do leased systems still get a federal credit?
- Because it is a different credit in a different part of the tax code, claimed by a different taxpayer. Under a lease or power purchase agreement the third-party owner holds the equipment and claims Section 48E. Whether any of that value reaches you depends entirely on the terms you sign.
- How do I find out what incentives apply where I live?
- Incentives arrive in four layers — federal, state, utility and local — and they are administered by four different bodies. The only reliable method is to check each layer separately against its own administrator, because no single list stays current across all of them.
- Do incentives get subtracted from my quote automatically?
- Usually not. Most tax credits are claimed on your return after the fact, so you pay the full price first. Some utility rebates are assigned to the installer and appear as a discount. Ask which of the two any figure in your proposal is, because they have very different cash-flow consequences.
- Can an installer guarantee I will get an incentive?
- No. Eligibility for a tax credit depends on your own tax position, which an installer does not know and is not qualified to advise on. Rebate programmes frequently have budget caps and can close mid-year. Treat any guarantee as a warning sign.
When you have read enough
Nothing here is gated and none of it needs an email address. If you have worked through the numbers and want to talk to someone who installs these systems, that is a separate step and it is your call when to take it.
HyreSolar is an independent solar information and homeowner-connection platform. We do not install, finance, maintain or service solar systems.