Solar Incentives
Federal Solar Tax Credit: What Changed
The residential 30% credit is gone for 2026 installations. Here's what that means — and why Illinois solar can still make sense.
The Short Version
The 30% residential clean energy credit (Section 25D) ended for homeowner systems completed after December 31, 2025. Commercial solar can still qualify for the Section 48E credit on a tight timeline.
- Homeowners: a system installed in 2026 is not eligible for the Section 25D credit. Installation had to be completed by December 31, 2025.
- Businesses: solar projects that began construction after July 4, 2026 must be placed in service by December 31, 2027 to qualify for the Section 48E clean electricity investment credit.
- Third-party-owned systems (leases and PPAs) are commercial property for the owner, which is why lease offers may still reflect federal incentive value.
- Cox Solar Solutions is not a tax advisor — confirm eligibility with a qualified tax professional.
What Illinois Homeowners Can Still Claim
Illinois' own programs weren't affected by the federal change. In fact, Illinois Shines added a $20-per-REC adder for the 2026-27 program year for customer-owned small systems that won't receive a federal credit.
- Illinois Shines REC incentive (15-year contract)
- ComEd / Ameren $300-per-kW solar rebate and $300-per-kWh storage rebate
- Property tax alternate valuation (PTAX-330)
- Illinois Solar for All for income-eligible households
Commercial Projects: Act Early
Businesses, farms, and other commercial owners may still qualify for the Section 48E clean electricity investment credit. Projects that begin construction after July 4, 2026 must be placed in service by December 31, 2027. If you're considering commercial solar, start the conversation now so construction and interconnection can be scheduled in time.
FAQ
Common Questions
I installed solar in 2025. Can I still claim the credit?
If installation was completed by December 31, 2025, the system may qualify for the 25D credit on your 2025 tax return. Check with your tax professional.
Why do some companies still mention a 30% credit for homeowners?
Some leases and power purchase agreements are structured so the system owner (a company) claims a commercial credit. As a homeowner purchasing a system in 2026, you can't claim the residential 25D credit.
Free solar quote
Get Your Free Customized Solar Plan
See your system design, Illinois incentives, and estimated savings — no pressure, no obligation.