Solar · Published 2026-07-21
Going Solar in 2026, After the Federal Tax Credit: The New Math
The 30% federal credit ended for purchased systems after 2025. Solar still pays in many states — but the map of where changed.
For two decades, the federal tax credit did a third of solar’s heavy lifting. With the residential credit gone for systems purchased after December 31, 2025, the question isn’t “is solar dead?” — it’s “where does it still pencil out on its own?” The honest answer: in fewer places, but very much in some.
The three numbers that now decide everything
- Your electricity rate. This is the payback engine. At 25¢+/kWh (New England, California, Hawaii), every panel-hour is worth roughly double what it earns in a 12¢ state — high-rate states still see compelling paybacks with zero federal help.
- Your installed cost per watt. Quotes for the same roof routinely differ 20%+; in a post-credit world, bid competition is worth thousands, not hundreds.
- Your state and utility incentives. These are now the only subsidies. Some states pay serious money; most pay little — check yours on the solar cost pages.
Who should still move, and who should wait
Move: high-rate states, strong net-metering policies, south-facing unshaded roofs, and anyone whose utility still pays real performance incentives. Wait or re-price: low-rate states with weak net metering, where the post-credit payback can stretch beyond 15 years. And everyone: get three quotes — the calculator shows what payback your rate and sun hours actually support.
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