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Posted On: 07/10/2025 9:29:12 AM
Post# of 13634
Solar farms and the 30% tax credit under the "One Big Beautiful Bill"
The "One Big Beautiful Bill" (OBBB), signed into law on July 4, 2025, has significantly altered the landscape of solar tax credits.
While the 30% Residential Clean Energy Credit (Section 25D) for homeowners is set to expire at the end of 2025,
the Investment Tax Credit (ITC) for commercial and utility-scale solar projects, including solar farms (Section 48E), remains active but with new deadlines and qualifications.
Here's a breakdown of the key points regarding solar farms and the 30% credit:
Commercial Solar ITC Remains: The commercial ITC under Section 48E was not eliminated by the OBBB.
30% Credit Available for Now: Projects that begin construction by July 4, 2026 can qualify for the full 30% commercial solar tax credit.
Four-Year Safe Harbor: These projects also benefit from a four-year safe harbor, allowing for completion as late as 2030, according to GreenLancer.
New Deadline for Later Starts: Projects that start construction after July 4, 2026, must be placed in service by December 31, 2027, to be eligible for any solar tax credit.
Potential Reductions: Some sources suggest that after 2025, the continuation of the ITC for commercial solar systems may depend on whether the solar and electric sectors meet emissions reduction goals.
Additional Credits: Commercial projects may be eligible for additional credits beyond the 30% if they meet criteria such as domestic content standards or are located in designated "energy communities" or low-income areas.
In essence, while the residential solar credit faces an imminent end, the commercial solar ITC for projects like solar farms is still available at 30% but with accelerated timelines and a strong emphasis on meeting specific deadlines for beginning construction or placing the project into service.
icymi
The "One Big Beautiful Bill" (OBBB), signed into law on July 4, 2025, has significantly altered the landscape of solar tax credits.
While the 30% Residential Clean Energy Credit (Section 25D) for homeowners is set to expire at the end of 2025,
the Investment Tax Credit (ITC) for commercial and utility-scale solar projects, including solar farms (Section 48E), remains active but with new deadlines and qualifications.
Here's a breakdown of the key points regarding solar farms and the 30% credit:
Commercial Solar ITC Remains: The commercial ITC under Section 48E was not eliminated by the OBBB.
30% Credit Available for Now: Projects that begin construction by July 4, 2026 can qualify for the full 30% commercial solar tax credit.
Four-Year Safe Harbor: These projects also benefit from a four-year safe harbor, allowing for completion as late as 2030, according to GreenLancer.
New Deadline for Later Starts: Projects that start construction after July 4, 2026, must be placed in service by December 31, 2027, to be eligible for any solar tax credit.
Potential Reductions: Some sources suggest that after 2025, the continuation of the ITC for commercial solar systems may depend on whether the solar and electric sectors meet emissions reduction goals.
Additional Credits: Commercial projects may be eligible for additional credits beyond the 30% if they meet criteria such as domestic content standards or are located in designated "energy communities" or low-income areas.
In essence, while the residential solar credit faces an imminent end, the commercial solar ITC for projects like solar farms is still available at 30% but with accelerated timelines and a strong emphasis on meeting specific deadlines for beginning construction or placing the project into service.
icymi
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