The federal 30% residential solar tax credit ended on December 31, 2025, so your 2026 savings now depend almost entirely on solar incentives by state 2026, including rebates, property tax exemptions, sales tax exemptions, and net metering programs. What you can claim depends heavily on where you live.
Why the Incentive Landscape Changed in 2026
For over a decade, homeowners across the country leaned on one number: 30%. That was the federal Residential Clean Energy Credit under Section 25D, and it applied no matter which state you lived in. The One Big Beautiful Bill Act, signed in 2025, ended that credit for any homeowner-owned system placed in service after December 31, 2025.
That single change is why so many homeowners are now searching for solar incentives by state in 2026 instead of relying on a flat federal number. If you’re asking is the federal solar tax credit still available in 2026, the short answer is no, not for cash- or loan-purchased residential systems.
There’s an important exception: if you lease your system or sign a power purchase agreement, the company that owns the panels may still qualify for a separate commercial credit under Section 48E, which remains active through 2027.
This matters more than it sounds. Whether solar makes financial sense for your home in 2026 now depends on stacking together whatever state solar rebates, 2026 programs, tax exemptions, and net metering rules your state and utility still offer.
Types of Solar Incentives Still Available
Before breaking things down state by state, it helps to understand the categories you’re actually looking for.
- State tax credits: A small number of states, unlike the federal government, still offer their own income tax credit for solar installation.
- Rebates: A direct payment or upfront discount, separate from any tax credit, often funded by the state or a utility.
- Property tax exemptions: Solar panels typically increase home value, but many states exempt that added value from property tax assessments.
- Sales tax exemptions: Some states waive sales tax on solar equipment purchases, which can save homeowners several hundred dollars.
- Net metering: Credits for the excess electricity your system sends back to the grid, which offsets what you’d otherwise pay your utility.
- SRECs (Solar Renewable Energy Certificates): Tradable certificates issued for the electricity your system produces, available in a handful of states with SREC markets.
Homeowners considering what solar incentives they can I claim in 2026 usually find that no single program covers everything. Most savings come from combining two or three of the categories above.
Solar Incentives by State 2026: A Snapshot
Programs shift often as budgets are set and reset, so treat this as a starting point rather than a final answer.
| State | Notable 2026 Incentives |
| California | Net metering (NEM 3.0, lower export rates), DAC-SASH rebate for qualifying low-income households, PACE financing |
| New York | NY-Sun rebate program, state tax credit, full retail net metering |
| New Jersey | Full retail rate net metering, no statewide capacity cap, sales tax exemption |
| Massachusetts | SMART incentive program, net metering with 12 month rolling credit, property tax exemption |
| Texas | No state income tax credit, but property tax exemption and some utility rebates |
| Florida | Property tax exemption, sales tax exemption, net metering (no state income tax) |
| Maryland | Solar Access Program covering qualifying installation costs, net metering, SREC market |
| Illinois | Illinois Shines adjustable block incentive, net metering |
| Arizona | State tax credit, property tax exemption, no sales tax on solar equipment |
| Colorado | Utility rebate programs, net metering, state incentives |
For states not listed here, the primary incentive available is typically net metering through your utility, since the federal credit is gone for most homeowner-owned systems. This is exactly why so many people are researching best states for solar incentives 2026 before deciding whether to install this year or wait.
Net Metering Is Doing More of the Work Now
With the federal credit gone, net metering by state 2026 policy has become one of the biggest factors in whether solar pays for itself quickly or slowly. States like Massachusetts, New York, Maryland, and New Jersey still offer full retail rate compensation for exported electricity, which shortens payback periods considerably.
California moved to NEM 3.0, which pays far less for exports and has pushed most new installations toward pairing solar with battery storage to use more of the power onsite rather than sending it to the grid.
If you’re comparing a cash purchase against a lease, it’s worth understanding how a solar lease differs from a solar loan, since ownership status affects which incentives you can personally claim versus which ones stay with the system owner.
Property Tax and Sales Tax Exemptions
These two categories are easy to overlook, but they add up. A solar property tax exemption on a state-by-state basis means the added home value from your system won’t increase your annual property tax bill, which is significant in states where solar can raise appraised value by tens of thousands of dollars.
States including New York, Florida, Massachusetts, and Arizona currently offer this exemption.
Sales tax exemptions work differently. Instead of protecting you long term, they reduce your upfront cost the day you purchase. In a state with a 6 to 8% sales tax, exempting solar equipment can save a homeowner several hundred to over a thousand dollars on a typical residential system.
How to Check What Applies to You
Because programs change with legislative sessions and funding cycles, don’t rely on outdated blog posts, including this one, without verifying current terms.
- Search the DSIRE database by zip code for every incentive currently listed for your address.
- Confirm the terms directly with your utility, since rebate and net metering rules are often set at the utility level, not the state level.
- Ask any installer for a written breakdown of exactly which incentives their quote assumes you’ll receive.
- Review your state energy office website for updates, since some programs pause when funding caps are reached.
If a salesperson tells you a specific dollar figure without naming the program it comes from, ask directly which incentive it is and confirm it independently before signing anything.
What This Means for Your Decision
The math around going solar in 2026 looks different than it did even a year ago. Without the flat 30% federal credit, the size of your savings now depends heavily on which solar incentives by state 2026 programs are active where you live, how your utility structures net metering, and whether your state still offers a tax credit, rebate, or exemption.
Homeowners who research the full range of solar incentives by state 2026 before signing tend to end up with far more accurate expectations than those who rely on a contractor’s estimate alone. A quick look at a <a href=””>total cost calculator</a> can also help you see how those incentives affect your real payback period before you commit to anything.
Know What You’re Signing Before You Commit
Understanding solar incentives by state 2026 is only half the picture. Homeowners sometimes discover after signing that the incentives a salesperson promised weren’t accurate or didn’t apply to their situation, which is a common thread in disputes over solar contracts.
Solar Equity Solutions is BBB accredited and has helped homeowners work through more than 5,000 solar contracts, with firsthand experience across nearly every major solar company in the country. If a contract you’re reviewing hinges on incentive claims for solar incentives by state 2026 that seem too good to verify, that’s worth a second look before you commit.
Frequently Asked Questions
Is the federal solar tax credit still available in 2026?
No, not for homeowner-owned residential systems. The Residential Clean Energy Credit under Section 25D expired for expenditures made after December 31, 2025.
What solar incentives can I claim in 2026?
It depends on your state, but common options include net metering, property tax exemptions, sales tax exemptions, and in some states, a direct rebate or state tax credit.
Does my state have a solar tax credit?
A limited number of states still offer one, including New York and Arizona. Most states rely instead on net metering and exemptions rather than a direct income tax credit.
How do I find solar incentives in my state?
The most reliable source is the DSIRE database, searchable by zip code, along with direct confirmation from your utility provider.
Are lease and PPA solar systems eligible for any tax credit in 2026?
The homeowner generally cannot claim a credit on a leased system, but the company that owns the panels may still qualify under Section 48E, which can indirectly lower your lease rate.
This article is for informational purposes only and does not constitute legal or tax advice. Solar incentive programs change frequently, so verify current details with your state energy office, utility, or a licensed tax professional before making a decision.