Solar Tax Credits set to expire in 2025
- Katie Burgess
- 3 days ago
- 2 min read
As a bit of an unexpected twist/turn on the "solar-coaster" ride the 'Big Beautiful Bill' will see the Federal Tax Credits for going solar being chopped by the end of 2025. So that's just over 4 months' time. Back in May we wrote a blog post about the potential for it to expire but it's now a reality.
This is a residential tax credit for going solar on your home and yes your home (first or second) can be your boat! It's 30% on the total system cost so can include solar panels, wiring, MPPT controllers, batteries, labor to install etc
Previously the Tax Credits were set to phase out gradually coming to an end in 2035, but not anymore! It's going from 30% to 0% on December 31st, 2025 so that's not exactly being phased out - that's getting the chop!
Timeline
On May 13th, 2025 the House Ways & Means Committee passed a draft bill that would eliminate the Residential Solar Tax Credit by December 31, 2025. It was then passed by the Budget Committee, passed a House Vote, was passed by the Senate and on July 4th President Trump signed it into law.
The 870 page-bill covers nearly every sector of the American economy but in particular it made significant changes to the tax credits available with respect to renewable energy and energy storage projects. Some of the language is still being deciphered/hashed out but in summary residential tax credits have been terminated.
What's happening? On Dec 31, 2025 the Tax Credit is going from 30% to 0%. That's not being phased out - that's getting the chop!
Can batteries be included in the Solar Tax Credit?
One of the most exciting updates to this year’s Form 5695 was the inclusion of credits for qualified battery storage technology. Battery storage technology costs are allowed for the Residential Clean Energy Credit for expenses paid after December 31, 2022, provided the battery has a minimum capacity of 3 kWh.
Qualified battery storage technology is also eligible if installed after December 31, 2022, and has a minimum capacity of 3kWh.
What is 3kWh? It equals 3,000Wh or 250Ah (for a 12V battery)
As with any tax advise please do consult your accountant or tax advisor for the most accurate and up to date info. All we can say is many of our customers have successfully received the 30% Federal Tax Credits on the total solar system cost aboard their boats. Don't miss out.
