Is there a federal solar tax credit in 2026?
For a new homeowner installation placed in service in 2026, do not assume the old 30% Residential Clean Energy Credit. The IRS says Section 25D is not available for property placed in service after December 31, 2025.
There are two different questions behind “the 2026 solar tax credit”: buying a system that starts operating in 2026, and filing a tax return in 2026 for an eligible installation completed in 2025. Those are not the same situation.
Which situation are you in?
| Situation | What to check |
|---|---|
| Home solar or battery first placed in service in 2026 | The IRS cutoff excludes new Section 25D claims for this property. Use zero for this homeowner credit in a new-project budget. |
| Eligible property installed in 2025; return filed in 2026 | The IRS describes a 30% credit for qualifying 2022–2025 installations. Check the tax-year rules, eligible costs and Form 5695. |
| Unused credit from an earlier eligible year | The IRS describes carrying unused credit forward. A carryforward is not eligibility for a new 2026 installation; check current filing instructions. |
| Business-owned, leased or power-purchase-agreement system | This page addresses the homeowner Section 25D credit, not every business incentive. Do not transfer a business tax-credit claim into a household cash-purchase calculation. |
Does paying a deposit establish eligibility?
The IRS says to claim for the tax year when the property is installed, not merely purchased. Do not treat an earlier quote, deposit or order date as proof that a later installation qualifies. Keep the installation and placed-in-service evidence and have uncertain cases checked against the applicable tax-year instructions.
What about a home battery?
Battery storage is included among the property types covered by the Residential Clean Energy Credit, but that does not remove the December 31, 2025 cutoff. The IRS lists at least 3 kWh of storage among the qualifying standards for eligible installations. Capacity alone does not establish eligibility, especially for a new 2026 purchase.
How to budget a 2026 project
- Start with the actual cash quote, including equipment, installation and required electrical work.
- Set the new homeowner federal Section 25D credit to zero. Our solar payback calculator defaults to zero.
- Check your state and utility for separately available programmes. Verify dates, income or equipment conditions, funding and stacking rules at the programme source.
- Separate bill savings from the value of outage backup. A battery can have a resilience benefit without a tax credit or quick financial payback.
- For portable backup, size the loads before comparing prices: use the outage planner and battery comparison.
State incentives are a separate question
The end of this homeowner federal credit does not by itself establish whether a state, utility or local programme is available. Start with our state guide directory, then check the linked programme administrator rather than relying on a national headline.
Primary sources
- IRS: Residential Clean Energy Credit — cutoff, eligible property, installation year and carryforward explanation. Accessed September 8, 2026.
- IRS: Form 5695 and tax-year instructions — use the instructions for the return you are filing.
This is a source-led planning explanation, not an eligibility determination for your tax return. Recheck IRS guidance before filing or committing to an installation.