Solar Rebates & Tax Credits in 2026: What’s Left After the Federal Credit Ended

There is no federal solar rebate or tax credit for a home system installed in 2026. The 30% Residential Clean Energy Credit (Section 25D) ended for systems placed in service after December 31, 2025. On a typical 7 kW system, that’s about $5,500 you no longer get back. What’s left are state tax breaks, utility rebates, and any credit you still have from a 2025 install.

Is there still a federal solar rebate in 2026?

No. There has never been a true federal solar “rebate” check. The federal help was a tax credit, and it has now ended for most homeowners.

The 2025 budget law, known as the One Big Beautiful Bill Act, cut the Residential Clean Energy Credit short. The IRS says the credit “is not available for any property placed in service after December 31, 2025.” Before the law, the 30% credit was set to run through 2032.

“Placed in service” means installed and ready to use. The IRS says you claim the credit for the year the system is installed, not the year you paid for it. So a deposit paid in 2025 doesn’t help if the system was finished in 2026.

How much did losing the federal credit cost homeowners?

The average installed price is about $2.60 per watt (EnergySage, June 2026). Here’s what 30% was worth at common sizes. See our solar panel cost guide for full price ranges.

The math for a 7 kW system: $18,340 × 30% = $5,502. That money now has to come from somewhere else, such as a local rebate, lower prices, or a solar loan spread over time.

Can I still claim the solar tax credit for a 2025 install?

Yes. If your system was installed and working by December 31, 2025, you can claim 30% of the cost on IRS Form 5695 with your 2025 tax return. If you missed it, talk to a tax preparer about filing an amended return.

The credit is nonrefundable. It can lower your tax bill to zero, but the IRS won’t send you the extra as a refund. Instead, any unused amount carries forward to future years.

Here’s a worked example for a 7 kW system installed in October 2025:

1. Credit earned: $18,340 × 30% = $5,502
2. Your 2025 federal tax owed: $3,000
3. Credit used in 2025: $3,000 (tax drops to $0)
4. Carried forward to 2026: $5,502 − $3,000 = $2,502

You’d file Form 5695 again for 2026 to use the $2,502. Keep your invoice and proof of the install date. A tax pro can confirm how carryforward works for your return.

Do solar leases and PPAs still get a federal credit?

Sometimes, but not for you directly. With a lease or a power purchase agreement (PPA), a company owns the panels on your roof. That company may still claim a business tax credit for a limited time under the new law.

Installers may pass some of that value on as a lower monthly payment. Nothing requires them to. Before you sign:

• Compare the lease or PPA price per kWh with your current utility rate.
• Check the yearly price increase (often called an escalator).
• Ask what happens if you sell the house.
• Check your utility’s rules. Austin Energy, for example, doesn’t allow third-party PPAs in its service area.

What solar rebates are still available in 2026?

Most remaining help is local. It falls into four groups:

State guides

• Solar panels in Texas: no statewide rebate, but a property tax exemption, utility rebates and buyback plans.
• Solar panels in California: NEM 3.0 net billing, SGIP battery money, and a property tax deadline.
• Austin Energy solar rebate: the $4,000 amount, who qualifies and how to apply.

How do I find solar rebates near me?

1. Search DSIRE. The Database of State Incentives for Renewables & Efficiency (dsireusa.org) lists state, local and utility programs. Enter your ZIP code and filter by “Solar Photovoltaics.”
2. Check your utility. Search your utility’s name plus “solar rebate.” City-owned utilities and co-ops often run their own programs.
3. Check your state energy office. Look for property tax or sales tax exemptions.
4. Ask installers. Get at least three quotes. Ask each one to list every incentive in writing.
5. Apply before you install. Many rebates, including Austin Energy’s, must be approved before work starts.

Is solar still worth it without the tax credit?

For many homes, yes, but payback is longer. Here’s a simple national example:

• Yearly output: 7 kW × 1,350 kWh = 9,450 kWh
• Bill value at 18.2¢/kWh: 9,450 × $0.182 = $1,720 per year
• Payback in 2026 (no credit): $18,340 ÷ $1,720 = about 10.7 years
• Payback with the old credit: $12,838 ÷ $1,720 = about 7.5 years

This assumes every kWh is worth the full retail rate. Under net billing or low buyback rates, exported power is worth less, so real payback can be longer. A local rebate shortens it again.

Frequently asked questions

Is the 30% solar tax credit gone for good?

Under current law, yes, for homeowner-owned systems placed in service after December 31, 2025. Congress could change this, but no new credit exists as of October 2026.

I paid in 2025 but my system was finished in 2026. Do I qualify?

Most likely not. The IRS ties the credit to when the system is installed, not when you paid. Ask a tax professional about your exact dates.

Do I need to own my system to get a utility rebate?

Usually. Most utility rebates go to systems the homeowner buys, with cash or a loan. Check each program’s rules.

Are batteries still eligible for a federal credit?

Not for homeowners. Home batteries were covered by the same 25D credit, which ended after 2025. Some states and utilities still pay for batteries.

Sources

• IRS: Residential Clean Energy Credit
• DSIRE: Database of State Incentives for Renewables & Efficiency
• Austin Energy: Home solar rebate
• CPUC: Self-Generation Incentive Program

Last updated: October 2026. Incentive rules change often, so confirm details with the IRS, your utility and a tax professional. This article is for information only and is not tax advice.