The federal Residential Clean Energy Credit under Section 25D was terminated for qualifying expenditures made after December 31, 2025. However, homeowners who completed qualifying solar, battery, or other eligible clean-energy projects during 2025 may still be able to claim the credit on their 2025 federal tax return filed during the 2026 tax season.
Is There Still a 30% Solar Tax Credit in 2026?
Not for new residential solar expenditures made after December 31, 2025. The former 30% Residential Clean Energy Credit applies to qualifying expenditures made through December 31, 2025. If your qualifying installation was completed in 2025, you may claim the applicable credit on your 2025 federal return during the 2026 filing season.
🧮 Check Your Solar Tax Credit Scenario →Solar Tax Credit 2026: What Happened to the 30% Federal Credit?
The federal 30% Residential Clean Energy Credit changed significantly after Congress accelerated its expiration. Learn whether you can still claim the credit for a 2025 installation, how the tax-credit carryforward works, how Form 5695 fits into the process, and what homeowners should know before buying solar in 2026.
Key Deadline
Qualifying Section 25D expenditures generally had to be made by December 31, 2025.
Former Credit
The Residential Clean Energy Credit was generally 30% for qualifying property through 2025.
Tax Form
Qualifying taxpayers use Form 5695 to calculate residential energy credits.
Battery Storage
Qualifying battery storage technology of at least 3 kWh was included under Section 25D.
📚 What You’ll Learn
Is the 30% Federal Solar Tax Credit Available in 2026?
This is the most important distinction homeowners need to understand. The 2026 tax-filing season is not the same thing as a 2026 solar installation.
The Residential Clean Energy Credit under Internal Revenue Code Section 25D was accelerated to terminate for expenditures made after December 31, 2025. Therefore, a homeowner who installs a new residential solar system in 2026 should not assume that the former 30% federal residential solar credit is available.
If you are filing your 2025 federal tax return in 2026, you may still be dealing with a qualifying Section 25D credit from a project completed in 2025. That does not mean a new solar installation completed in 2026 automatically receives the same 30% federal credit.
The December 31, 2025 Solar Tax Credit Deadline
The timing rule is especially important because paying a contractor is not necessarily enough by itself to preserve Section 25D eligibility.
IRS guidance explains that for purposes of Section 25D, an expenditure for an item is generally treated as made when the original installation of the item is completed. If installation was completed after December 31, 2025, the expenditure is treated as occurring after that date for purposes of the credit.
Timeline Example
| Scenario | Potential Section 25D Treatment |
|---|---|
| Solar project completed in 2025 | May qualify if all other requirements are satisfied. |
| Paid in 2025 but installation completed in 2026 | Generally not eligible under Section 25D based solely on the earlier payment. |
| New residential solar installation completed in 2026 | Former 25D residential credit is not available for post-2025 expenditures. |
Who May Still Claim the Solar Tax Credit in 2026?
A homeowner may still encounter the 30% Residential Clean Energy Credit during the 2026 filing season if the qualifying expenditure was made within the period allowed by Section 25D and all applicable requirements were satisfied.
🏠 Eligible Residence
The IRS describes eligible property in terms of qualified residences located in the United States.
☀️ Qualified Property
Solar electric property and other specifically listed clean-energy technologies may qualify when the applicable requirements are met.
📑 Documentation
Receipts, contracts and installation records should be retained to substantiate the claim if requested.
💵 Tax Liability
The credit is nonrefundable and cannot exceed the applicable tax limitation for the year.
What Solar Equipment Qualified for the 30% Credit?
For qualifying years, the Residential Clean Energy Credit covered specific types of residential clean-energy property. The IRS identifies several categories, including:
- Solar electric property, including qualifying solar photovoltaic systems.
- Solar water-heating property meeting the applicable certification requirements.
- Qualified small wind energy property.
- Qualified geothermal heat pump property.
- Qualified fuel cell property.
- Qualified battery storage technology meeting the applicable capacity requirement.
Traditional roofing materials and structural components generally do not qualify simply because they were necessary to install solar panels. Solar shingles or solar roofing products that themselves generate electricity are treated differently.
🔋 Did Home Batteries Qualify for the 30% Solar Tax Credit?
Yes, battery storage technology was specifically included as qualified property under Section 25D, subject to the applicable rules. The IRS specifies a minimum capacity of 3 kilowatt-hours for qualifying battery storage technology.
What This Means for 2025 Projects
A qualifying battery installed as part of a project that falls within the applicable Section 25D period could potentially be included in the qualified expenditure calculation. The fact that a battery can be paired with solar is not, by itself, enough; the specific equipment and timing requirements still matter.
How the 30% Credit Worked: Real-World Examples
For qualifying expenditures under the former 30% Section 25D rate, the basic calculation was straightforward: multiply eligible qualified expenditures by 30%, then apply the applicable tax limitation and other rules.
$20,000 Project
If the entire $20,000 were qualified and the 30% rate applied:
Potential calculated credit before applying applicable limitations.
$30,000 Project
If the entire $30,000 were qualified and the 30% rate applied:
Potential calculated credit before applicable tax limitations.
$40,000 Project
If the entire $40,000 were qualified and the 30% rate applied:
Potential calculated credit before applicable tax limitations.
The Residential Clean Energy Credit was nonrefundable. The actual amount usable in a particular tax year depended on the taxpayer’s applicable tax liability and the rules on Form 5695. Unused amounts could potentially carry forward under the applicable rules.
Can an Unused Solar Tax Credit Carry Forward?
One of the most important features for taxpayers who qualified for the credit is the treatment of unused credit. The credit was nonrefundable, meaning it could not simply create an unlimited cash payment when the credit exceeded the applicable tax liability.
However, qualifying unused amounts could be carried forward under the applicable rules. This is particularly important for homeowners whose calculated credit was larger than the amount they could use in the current tax year.
Simple Example
Imagine a qualifying 2025 project generated a calculated credit of $9,000, but the taxpayer’s applicable limitation meant only $6,000 could be used for that year. The remaining $3,000 may be carried forward according to the applicable rules.
The exact calculation should be completed using the applicable Form 5695 instructions for the tax year involved.
🧾 How to Claim a Qualifying Solar Tax Credit with Form 5695
For qualifying residential clean-energy expenditures, taxpayers use IRS Form 5695, Residential Energy Credits, with their federal income tax return.
Confirm Timing
Determine whether the installation/expenditure falls within the applicable credit period.
Gather Records
Keep contracts, receipts, invoices and installation documentation.
Complete Form 5695
Use the form and instructions applicable to the tax year being filed.
Retain Documentation
Keep supporting records in case the IRS requests substantiation.
Do not automatically use an old tax form or assume that a form’s instructions from a previous year still apply unchanged. Always use the IRS form and instructions for the relevant tax year.
📂 Solar Tax Credit Documentation Checklist
- Final contractor invoice
- Solar equipment invoices
- Battery invoice, if applicable
- Installation agreement
- Proof of payment
- Permit documentation
- System specifications
- Evidence of installation completion
- Manufacturer documentation where relevant
- Copies of the tax forms submitted
🚨 10 Common Solar Tax Credit Mistakes
The former residential 25D credit ended for post-2025 expenditures.
A return filed in 2026 can relate to a 2025 installation.
Installation timing can determine when an expenditure is treated as made.
The residential credit was nonrefundable.
Battery storage had its own qualification requirements.
Traditional roofing and structural costs generally were not automatically qualifying expenses.
Supporting records matter if the claim is later reviewed.
Always check the latest IRS instructions for the relevant tax year.
Federal and state programs are separate and may have different rules.
Compare total project cost, financing, warranties and expected production.
☀️ Should You Still Buy Solar in 2026?
The expiration of the federal residential 25D credit does not automatically mean solar is a bad investment. It means homeowners should evaluate the economics without assuming a 30% federal tax credit that may no longer exist for the project.
Higher electricity costs can improve the potential value of solar generation.
Roof orientation, shading and system size influence production.
Compare total installed price rather than focusing only on monthly financing.
Evaluate battery cost, backup value and utility-rate structure separately.
🔧 Useful Home Energy Products
If you are improving your home’s energy efficiency or preparing for backup power, the following types of equipment may be useful. Product availability and pricing can change, so always verify current specifications before purchasing.
Portable Backup Power
Portable battery systems can provide backup electricity for selected appliances during outages. They are not automatically equivalent to a permanently installed solar battery and should not be represented as qualifying Section 25D property without confirming the applicable tax rules.
Check Current Amazon Price →Smart Thermostat
Smart thermostats can help manage heating and cooling schedules and reduce unnecessary energy consumption. Actual savings depend on the home’s HVAC system, weather, settings and household behavior.
Check Current Amazon Price →Calculate Before You Buy
Don’t make a major home-energy purchase using headlines alone. Use our calculators to estimate project economics and compare scenarios.
Explore More Solar & Energy Guides
Frequently Asked Questions About the Solar Tax Credit 2026
Is the 30% solar tax credit still available for new installations in 2026?
No. The Residential Clean Energy Credit under Section 25D was terminated for expenditures made after December 31, 2025. A new residential installation completed in 2026 should not be assumed to qualify for the former 30% credit.
Can I still claim the solar tax credit in 2026?
Potentially, if you are filing a return involving qualifying expenditures that occurred within the period when Section 25D applied, such as a qualifying 2025 installation. The fact that you file the return in 2026 does not turn a 2025 credit into a 2026 installation credit.
What if I paid for solar in 2025 but the installation was completed in 2026?
The IRS has specifically addressed this situation. For Section 25D, an expenditure for an item is generally treated as made when the original installation is completed. Therefore, simply paying before December 31, 2025 does not necessarily preserve the credit if the installation was completed afterward.
Was the Residential Clean Energy Credit really 30%?
Yes. For the applicable qualifying period, the Residential Clean Energy Credit was generally calculated at 30% of qualified expenditures. The important issue in 2026 is that the credit was terminated for expenditures after December 31, 2025.
Can batteries qualify for the residential clean energy credit?
Battery storage technology was an eligible category under Section 25D when the credit applied, with a minimum capacity requirement of 3 kilowatt-hours. Timing and all other eligibility requirements still applied.
Is the solar tax credit refundable?
No. The Residential Clean Energy Credit was nonrefundable. The amount usable in a tax year was subject to the applicable tax limitation. Qualifying unused credit could be carried forward under the applicable rules.
Do I need Form 5695?
Form 5695 is the IRS form used to calculate residential energy credits. Taxpayers should use the form and instructions applicable to the tax year being filed.
Can traditional roof replacement costs qualify?
Generally, traditional roofing materials and structural components do not qualify merely because they support a solar installation. Solar shingles and solar roofing products that themselves generate electricity are treated differently under the IRS rules.
Should I still consider solar in 2026?
Potentially. The economics now need to be evaluated without automatically including the former federal 25D residential credit. Electricity rates, installed system cost, solar production, financing, utility rules and other incentives can still influence whether a project makes financial sense.
Where can I calculate my solar savings?
Start with the Rebate Radar Solar Payback Calculator and then compare your scenario with our Solar Tax Credit Calculator .
Don’t Buy Solar Based on an Outdated 30% Credit
The biggest mistake homeowners can make in 2026 is using outdated articles or sales presentations that still assume every new solar installation receives the former federal 30% residential tax credit.
Use current rules, calculate the project economics and investigate the incentives that actually apply to your location and installation date.
Official Sources & Verification
The federal tax information on this page should be verified against current IRS guidance, including the Residential Clean Energy Credit information, Form 5695 and applicable IRS instructions. Tax laws and administrative guidance can change.
IRS Residential Clean Energy Credit → IRS Form 5695 →Disclaimer: Rebate Radar is an independent informational publisher and is not affiliated with the Internal Revenue Service, U.S. Department of the Treasury, any state tax agency, utility company, solar manufacturer or government agency unless explicitly stated. This page is for educational purposes and does not constitute tax, legal, financial or accounting advice. Eligibility depends on the taxpayer, property, expenditure, installation timing and applicable law. Always verify current requirements with IRS.gov, the applicable government agency, qualified tax professional or other appropriate professional before making a tax or energy investment decision.
Some links on this page may be affiliate links. If you purchase through an affiliate link, Rebate Radar may receive a commission at no additional cost to you. Affiliate relationships do not determine our eligibility analysis or tax guidance.