Is There Still a Federal Tax Credit for Solar Panels in 2026
Yes, there’s still a federal tax credit for solar panels in 2026, but it only applies to commercial systems. The popular Section 25D credit, which allowed homeowners to deduct 30% of their solar bill, expired on December 31, 2025, under the One Big Beautiful Bill Act.
If you are ready to install home solar on Long Island, you can still access the New York State solar tax credit or leverage the commercial tax credit through the Participate Energy Pre-Paid Solar Lease Program.
The New York State Solar Tax Credit
Officially called the Solar Energy System Equipment Credit, the NYS solar tax credit is worth up to 25% of the cost of your solar installation, capped at $5,000.
- This state tax credit is available for purchased solar energy system equipment, including solar panels, solar batteries, and associated equipment/installation costs.
- It is also available when you enter into a written agreement to lease solar energy system equipment.
- The credit isn’t refundable, but you can carry it over for up to five years if the total credit exceeds the amount you owe in state income taxes.
This credit can significantly reduce the cost of switching to home solar on Long Island.
The Participate Energy Program
If you’re looking for an alternative pathway to solar that also leverages the commercial solar tax credit, the Participate Energy Program is a compelling option.
Available through Power Solutions, one of the best-rated solar contractors on Long Island, the Participate Energy Program is a pre-paid solar lease with unique features.
- As a lease program, Participate Energy retains ownership of the system, making it eligible for a commercial solar tax credit.
- The commercial tax credit is passed to you as a discount on a pre-paid lease.
- The commercial credit is worth up to 30% of the total cost of the solar array and associated hardware.
- There is no FICO score requirement, and no lien is placed on your home.
- You can transfer the lease if you move.
- There’s an option to purchase the system outright on the 6th year anniversary.
This is one of the most affordable ways to get solar connected. You will enjoy the savings of solar panels without the high upfront cost of purchasing a system outright.
Get a Free Consultation for Residential Solar in Nassau or Suffolk County
Power Solutions is ready to help you explore your options and can compare the financials for buying your system outright, financing it, or signing up for a solar lease that leverages the federal solar tax credit. Our consultations are detailed, and our team will predict your savings over time.
Start with your free home solar estimate online or call a Long Island solar consultant directly at (631) 348-0001.
