If you’re considering solar panels or other renewable energy upgrades, now may be your last chance to take full advantage of the 30 percent Residential Clean Energy Credit (RCEC).
What Is the RCEC?
The RCEC is a federal, non-refundable tax credit equal to 30 percent of the cost of qualified clean energy systems, including:
- Solar electric panels
- Solar water heaters
- Geothermal heat pumps
- Small wind energy systems
Eligible properties include primary and secondary residences, as well as rentals occupied by the taxpayer. Landlords who do not reside in the property are not eligible.
What’s Changing?
Currently, the RCEC remains at 30 percent through 2032, with step-downs in 2033 and 2034, and full expiration after 2034. However, new legislation could end the credit much sooner:
House Bill H.R. 1 would eliminate the credit for property installed after December 31, 2025.
The Senate bill follows H.R. 1 and terminates the credit after 2025.
This means 2025 may be the final year to claim the full benefit—regardless of the original phaseout schedule.
Why Act Now?
Installation takes time. From selecting a system to full installation and inspection, the entire process can span months. To qualify for the credit, you must place your system in service by December 31, 2025.
Although the RCEC is non-refundable, unused credits can carry forward to future tax years.
Now is the perfect time to review your tax strategy and take advantage of available credits and deductions. Early tax planning can help you maximize savings and avoid last-minute stress.
For expert guidance and professional Tax Preparation in Fort Worth, AG FinTax can help you navigate energy tax credits and optimize your financial strategy.
