Don’t Let Congress Kill the 30% Tax Credit for Solar Panels
If you’ve been thinking about installing solar panels for your home, now is the time to act.
On May 22, the House narrowly passed a new bill that would kill the Section 25D Residential Clean Energy Credit, one of the most effective and accessible tools for helping everyday Americans go solar, at the end of 2025.
At SouthFace Solar & Electric, we’ve spent years helping homeowners across Arizona take control of their energy future—saving money, increasing home value, and reducing their dependence on fossil fuels. But today, we’re reaching out with urgency.
If this credit is eliminated, the economic ripple effects will be devastating for working families, small businesses, and the entire clean energy workforce.
Remind Me: What Is the Solar Tax Credit?
The 25D solar tax credit allows homeowners to deduct 30% of the cost of a solar energy system (including equipment, labor, permitting, and batteries) from their federal taxes. It’s a well-designed incentive that makes solar affordable for average Americans, not just the wealthy.
To give you an idea of how much you can save: a $30,000 solar installation qualifies for a $9,000 tax credit, bringing your costs down to $21,000.
What’s Changing?
Congress is considering a new bill that, if passed, would eliminate the residential solar tax credit at the end of this year.
Here’s what’s happened so far:
On May 14th, the House Ways and Means Committee proposed its piece of the Budget Reconciliation Bill. Among other things, the Committee proposed a fast-paced phase-out of several clean energy tax credits put in place by the Inflation Reduction Act (IRA), including the residential solar tax credit.
The bill passed the House on May 22 and will now go to the Senate.
What Happens If It’s Eliminated?
- Homeowners will lose access to thousands of dollars in savings—making solar financially out of reach for many.
- Small businesses like ours will suffer major setbacks, potentially leading to layoffs and reduced operations.
- Progress toward energy independence and sustainability will slow, putting America further behind in the clean energy transition.
- The middle class will be hit hardest, as utility costs continue to rise and solar becomes harder to afford.
What Can You Do to Fight Back?
If you want to help protect the solar tax credit and your right to energy choice, call your Senator and make your voice heard.
Tell them:
“I strongly oppose the elimination of the 25D Residential Clean Energy Credit. This tax credit is vital to my ability to invest in clean, affordable solar energy for my home. Its removal would hurt my family, my community, and small businesses in the solar industry.”
Find your Senators and their contact information.
What This Means for Homeowners Considering Solar
If you’re thinking about installing solar, our advice is: don’t wait.
Solar panels are still a worthwhile investment without the solar tax credit, but a more expensive one.
Plus, there are timelines to consider. The solar installation process takes a few months to complete. With tax credit changes looming, we will be working as quickly as possible. But when changes like this happen, there’s usually a rush to go solar, which can clog up not only our installation timeline but also the permitting and grid interconnection process.
Starting your solar installation now will help you get out in front of potential delays so you can get your system up and running before the tax credit ends.
At SouthFace Solar & Electric, we believe in affordable, accessible solar energy. This tax credit is a huge part of making that possible. We’ve come too far to let short-sighted policies erase the progress we’ve made. Whether you’ve already gone solar or you’re planning to, this credit impacts all of us. Let’s make our voices heard and protect the future of solar energy in America.
