What changed on July 4, 2025
The One Big Beautiful Bill Act accelerated the end of the homeowner Residential Clean Energy Credit. For homeowner-purchased solar panels and battery storage, the 30% credit is not available for expenditures after December 31, 2025.
That means a homeowner planning a brand-new 2026 purchase should evaluate quotes without assuming a federal 25D credit will reduce the installed price.
If you installed before the cutoff
Homeowners who installed and paid eligible costs by December 31, 2025 can still claim the historical credit on a 2025 return. The claim is typically filed on Form 5695, and you should keep signed contracts, invoices, proof of payment, and equipment details with your tax records.
For many households, that historical credit still matters because 2025 returns are filed in 2026. If your project crossed the year-end cutoff, confirm timing with a tax professional rather than assuming eligibility.
Step by step
- Confirm your project met the cutoff
Verify that eligible solar or battery costs were incurred by December 31, 2025 before assuming the historical homeowner credit still applies.
- Gather project records
Collect contracts, invoices, proof of payment, and equipment details so the eligible installed costs are clearly documented.
- Complete Form 5695
Use IRS Form 5695 to calculate and report the historical Residential Clean Energy Credit on your 2025 federal return.
- File with your 2025 tax return
Submit the claim with your 2025 federal filing and confirm any cutoff-timing questions with a qualified tax professional if the project crossed year-end.
What still matters in 2026
State tax credits, rebates, property-tax exclusions, utility programs, and net-metering rules are separate from the expired homeowner federal credit. These local programs can still materially change payback, especially in high-rate states.
If you are comparing a solar lease or PPA, ask the provider whether it reflects any commercial clean-energy incentive in the quoted payment structure. That is a different framework from the old homeowner 25D credit.
