Incentives · policy as of 2026-09-24

Federal credits, as the engine applies them

The 2025 law ended the homeowner credit and set deadlines for solar and wind. This page is the rules table the Modeler and the Quote Studio use, with the statute or IRS source for each rule. No credit is applied until you confirm eligibility, and sites outside the United States get none.

Homeowners

0 % for systems installed after 2025

Homeowner credit (§25D) ended. A lease or PPA owner may still claim §48E; any value reaches you only through the price.

Solar and wind

Begin by Jul 4, 2026 or be in service by Dec 31, 2027

§48E rate: 6% base, 30% with wage/apprenticeship or under 1 MW AC.

Storage

Full credit for construction through 2033

Then 75 % in 2034, 50 % in 2035 and none from 2036. The foreign-entity cost tests apply from 2026.

What changed in 2025–26

Dated events, each linked to the rule that carries its citations.

Incentive policy timeline
Date	Event	Rule
2025-01-19	Property acquired after this date qualifies for 100% bonus depreciation (made permanent by Pub. L. 119-21 §70301).	100% bonus depreciation (property acquired after 2025-01-19)
2025-07-04	Pub. L. 119-21 (OBBBA) enacted: ends §25D, sets the solar/wind deadlines and the FEOC rules for §48E.	Solar and wind: begin construction by 2026-07-04 or be in service by 2027-12-31
2025-12-31	Last day for a homeowner-owned system to be installed and still claim §25D.	Homeowner credit (§25D) ended
2026-01-01	Prohibited-foreign-entity material-assistance test applies to projects that begin construction from 2026.	Prohibited-foreign-entity (FEOC) material-assistance test
2026-02-12	IRS Notice 2026-15: interim safe harbors for the material-assistance cost ratio.	Prohibited-foreign-entity (FEOC) material-assistance test
2026-06-06	D.D.C. vacates IRS Notice 2025-42; the 5% safe harbor is restored pending appeal.	Beginning-of-construction evidence is an attestation
2026-07-04	Last day for solar and wind to begin construction and escape the 2027 placed-in-service deadline.	Solar and wind: begin construction by 2026-07-04 or be in service by 2027-12-31
2027-12-31	Solar and wind that began construction after 2026-07-04 must be placed in service by this date.	Solar and wind: begin construction by 2026-07-04 or be in service by 2027-12-31
2034-01-01	Storage beginning construction in 2034 gets 75% of the credit; 50% in 2035; 0% from 2036.	Storage keeps §48E through 2033, then phases down

Who can claim a credit

Homeowner credit (§25D) ended

The residential clean energy credit does not apply to expenditures made after December 31, 2025, and an expenditure is treated as made when the original installation is completed. A homeowner who buys a system completed in 2026 or later gets no federal credit.

Sources: 26 U.S.C. §25D(h) and (e)(8)(A) (read 2026-09-24) · IRS FS-2025-05, FAQs on the OBBB changes to §§25C, 25D and related credits (read 2026-09-24) · Pub. L. 119-21 (One Big Beautiful Bill Act), 139 Stat. 72, July 4, 2025 (read 2026-09-24)

Leases and PPAs: the owner, not the homeowner, claims §48E

§48E(i) denies the credit only for leased solar water heating and small wind (§25D(d)(1), (d)(4) property). A third-party owner of leased solar PV or storage may claim §48E (subject to the solar deadline and FEOC rules); any value reaches the customer only through a lower lease or PPA price.

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24)

No U.S. credit outside the United States

No investment credit is determined for property used predominantly outside the United States (§50(b)(1)). Sites in other countries resolve to 0%; enter any local subsidy separately.

Sources: 26 U.S.C. §50(b)(1) and (c)(3) (read 2026-09-24)

U.S. possessions depend on the owner

Property used in a U.S. possession can qualify only through the §168(g)(4) exception referenced in §50(b)(1) (for example, property owned by a domestic corporation or U.S. citizen). The resolver applies 0% unless that ownership is confirmed.

Sources: 26 U.S.C. §50(b)(1) and (c)(3) (read 2026-09-24)

The §48E clean electricity investment credit

§48E rate: 6% base, 30% with wage/apprenticeship or under 1 MW AC

The clean electricity investment credit is 6% of the qualified investment, or 30% for a facility or storage system with a maximum net output under 1 MW (AC) or one that meets the prevailing-wage and apprenticeship requirements (§48E(a)(2)).

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24)

Solar and wind: begin construction by 2026-07-04 or be in service by 2027-12-31

§48E does not apply to wind or solar property placed in service after December 31, 2027 (§48E(e)(4)). Under Pub. L. 119-21 §70513 that termination applies only to facilities whose construction begins more than 12 months after July 4, 2025, so a facility that began construction by July 4, 2026 keeps the credit. Storage placed at a solar or wind facility is excepted (§48E(e)(4)(C)).

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24) · Pub. L. 119-21 (One Big Beautiful Bill Act), 139 Stat. 72, July 4, 2025 (read 2026-09-24)

Storage keeps §48E through 2033, then phases down

The applicable year is 2032 (§45Y(d)(3)). Storage that begins construction through 2033 keeps 100% of the credit, 75% in 2034, 50% in 2035 and 0% from 2036 (§48E(e)(1)–(2)).

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24) · 26 U.S.C. §45Y(d)(3) (applicable year = 2032) and (g)(12) (elective-payment phase-out) (read 2026-09-24)

Beginning-of-construction evidence is an attestation

IRS Notice 2025-42 (physical-work test only) was vacated on June 6, 2026 (D.D.C. No. 25-4400), restoring the 5% safe harbor pending appeal; a reversal could apply retroactively. The resolver takes the construction-start date as a user attestation — confirm it with tax counsel.

Sources: Oregon Environmental Council v. IRS, No. 25-4400 (D.D.C. June 6, 2026) vacating Notice 2025-42 (McGuireWoods summary) (read 2026-09-24)

Prohibited-foreign-entity (FEOC) material-assistance test

For construction beginning after December 31, 2025, no credit is allowed if the project receives material assistance from a prohibited foreign entity: its material-assistance cost ratio must be at least the threshold for the year construction begins — qualified facilities 40% (2026), 45% (2027), 50% (2028), 55% (2029), 60% (after 2029); energy storage 55%, 60%, 65%, 70%, 75%. Specified-foreign and foreign-influenced taxpayers are barred outright (§48E(d)(6)).

Sources: 26 U.S.C. §7701(a)(52)(B) (material-assistance threshold percentages) (read 2026-09-24) · 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24) · IRS Notice 2026-15, interim prohibited-foreign-entity material-assistance safe harbors (read 2026-09-24)

Bonuses and elective pay

Energy-community bonus

Placed in service in an energy community: +10 percentage points at the 30% rate, +2 points at the 6% base rate (§48E(a)(3)(A)).

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24)

Domestic-content bonus

Meeting the domestic-content requirement adds +10 percentage points at the 30% rate, +2 at the base rate. The manufactured-products adjusted percentage is 50% for construction beginning in 2026 and 55% after 2026 (§48E(a)(3)(B)).

Sources: 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24)

Elective pay needs domestic content at 1 MW and above

A tax-exempt owner using elective payment (§6417) for a facility of 1 MW AC or more that does not meet domestic content receives 90% (construction began 2024), 85% (2025) or 0% (after 2025) of the credit, unless a Treasury exception applies (§45Y(g)(12), applied to §48E by §48E(d)(5)).

Sources: 26 U.S.C. §45Y(d)(3) (applicable year = 2032) and (g)(12) (elective-payment phase-out) (read 2026-09-24) · 26 U.S.C. §48E (Clean electricity investment credit), as amended by Pub. L. 119-21 §§70512–70513 (read 2026-09-24) · 26 U.S.C. §6417 (elective payment) and §6418 (transfer of credits) (read 2026-09-24)

Transfer or elective pay

A taxable owner without tax appetite can sell the credit for cash (§6418), typically below face value; a tax-exempt owner can elect direct payment (§6417). Enter the realized price per $1 of credit.

Sources: 26 U.S.C. §6417 (elective payment) and §6418 (transfer of credits) (read 2026-09-24)

Depreciation and tax

Depreciable basis is reduced by half the credit

For the energy / clean electricity investment credit, the depreciable basis is reduced by 50% of the credit (§50(c)(3)).

Sources: 26 U.S.C. §50(b)(1) and (c)(3) (read 2026-09-24)

5-year MACRS for §48E / §45Y property

Qualified facilities and qualified property under §45Y/§48E and energy storage technology are 5-year property (§168(e)(3)(B)(viii)). Pub. L. 119-21 §70509 struck the older §48(a)(3)(A) solar/wind reference in clause (vi) for construction beginning after 2024, but clause (viii) remains. Half-year convention schedule: 20%, 32%, 19.2%, 11.52%, 11.52%, 5.76%.

Sources: 26 U.S.C. §168(e)(3)(B)(viii) and (k)(1)(A); Pub. L. 119-21 §§70301, 70509 (amendment notes) (read 2026-09-24) · NREL REopt.jl src/core/financial.jl macrs_five_year / macrs_seven_year (IRS Pub. 946 half-year tables), commit 97119a8 (2026-09-18) (read 2026-09-24)

100% bonus depreciation (property acquired after 2025-01-19)

Pub. L. 119-21 §70301 made the §168(k) additional first-year allowance 100% for property acquired after January 19, 2025 (property is not acquired after the date a written binding contract is signed). A taxpayer may elect 40% for the first tax year ending after January 19, 2025.

Sources: 26 U.S.C. §168(e)(3)(B)(viii) and (k)(1)(A); Pub. L. 119-21 §§70301, 70509 (amendment notes) (read 2026-09-24) · Pub. L. 119-21 (One Big Beautiful Bill Act), 139 Stat. 72, July 4, 2025 (read 2026-09-24)

Federal corporate income tax rate

The federal corporate income tax rate is 21% (§11(b)). State income tax is entered separately.

Sources: 26 U.S.C. §11(b) (21 percent corporate rate) (read 2026-09-24)

Screening, not tax advice. Wage and apprenticeship compliance, the foreign-entity cost ratio and the construction-start date are your attestations; the engine echoes them back as warnings. Confirm eligibility with a tax professional. The rules are re-checked when the law or guidance changes, and this page shows the date they were last read. See the terms and the methodology.