Thinking About Going Solar? Here’s What the Big Beautiful Bill Means for You and the solar tax credit

If you’ve been researching solar panels for your home, the recently passed One Big Beautiful Bill Act (also called the Big Beautiful Bill) is a game changer. This new law directly impacts the federal solar tax credit, and if you’re a homeowner, you have a limited time to take advantage of it.

30% Federal Solar Tax Credit Ends for Homeowners After 2025

The federal solar tax credit — officially called the Residential Clean Energy Credit (Section 25D) — has been one of the most valuable incentives for homeowners going solar. Until now, it covered 30% of your solar system cost, including panels, inverters, and battery storage, with no cap.

Under the Big Beautiful Bill, that 30% homeowner solar tax credit will expire on December 31, 2025. Any residential solar installation completed after that date will no longer qualify.

That means:

• Installations finished by the deadline can still claim 30% of the cost as a credit on your federal taxes.

• If your credit is larger than your tax bill, you may carry forward the unused amount to future tax years (subject to IRS rules).

• Starting January 1, 2026, there will be no federal solar tax credit for homeowner-owned systems.

Why the Deadline Is Critical

On a $25,000 solar installation, the 30% tax credit equals $7,500 in savings. Without it, your out-of-pocket costs jump significantly.

Delaying your decision could mean:

• Installer backlogs as demand surges in late 2025.

• Permit and utility approval delays that push projects past the deadline.

• Higher long-term costs without the incentive offset.

What About Solar Leases or PPAs?

If you choose a solar lease or Power Purchase Agreement (PPA), you don’t claim the credit — the system owner does. These third-party–owned (TPO) systems will still qualify for the federal tax credit through December 31, 2027, as long as construction starts by July 4, 2026. But for homeowners wanting to own their system outright, the credit is gone after 2025.

How Homeowners Can Lock In the 30% Solar Tax Credit

If you want to take advantage of the federal incentive before it disappears:

1. Get quotes now from certified solar installers.

2. Sign contracts early to secure your place in the installation schedule.

3. Allow time for permitting, inspections, and utility approvals.

4. Aim for completion well before the December 31, 2025 deadline.

   
   

Final Takeaway

The Big Beautiful Bill puts a hard stop on the 30% federal solar tax credit for homeowners after 2025. Acting now can save you thousands, increase your home’s value, and help you avoid rising electricity costs.

If solar has been on your radar, 2025 is the year to make it happen.