How to Maximize Solar Credits Before Year-End

What changed for solar credits in 2026

The 30% residential clean energy credit (Section 25D) ended for installations completed after December 31, 2025. If you installed in 2025, you can still claim it, and any amount you can’t use rolls forward to future returns. For everything else, year-end now centers on state incentives, utility programs and renewable energy credits. For a state-by-state look at what remains, see our guide to state solar incentives after the federal credit ended.

Claim All Your Solar Renewable Energy Credits (SRECs) Before Year-End

SRECs are certificates your system earns for each megawatt-hour it produces, and they can be sold separately from the power itself. Utilities and other buyers purchase them to meet state renewable energy targets.

If you live in a state with an active SREC market, your system has been generating credits all year — and year-end is the time to confirm registration, verify production reporting, and sell any accumulated credits. As of 2026, Washington DC, Delaware, Maryland, Ohio, Pennsylvania and Virginia have active SREC or performance-payment programs. Washington DC has the most valuable SRECs in the country, with certificates trading around $350 to $400 or more in 2026.

Year-end SREC checklist:

• Log into your SREC aggregator or state registry and confirm your system’s production data is current and accurate through December
• Verify your meter readings match what’s reported in the registry — discrepancies can delay credit issuance
• Sell any accumulated credits before market rates shift in January, especially in states where SREC prices fluctuate with supply and demand
• Review your aggregator’s contract terms — some brokers require annual renewals or allow you to switch to spot-market sales

Start with DSIRE, the most reliable database of state and utility incentives. If you’re unsure whether your state has an active SREC program or how to register, start there or contact a local solar installer familiar with your state’s programs.

Understand Your Net Metering Annual True-Up and Credit Rollover

Most states with net metering programs settle your account annually, typically at the end of your 12-month billing cycle or at a fixed calendar date. This settlement — called an annual true-up — determines whether you have a credit balance to roll over, whether the utility pays you for excess generation, or whether you owe for net consumption.

Before year-end, review your utility account to understand:

• Your true-up date: Some utilities use your solar interconnection anniversary; others use a fixed date like March 31 or April 30. Knowing this helps you time high-consumption activities.
• Credit rollover rules: In many states, surplus kilowatt-hour credits roll month to month but are zeroed out or paid at a wholesale rate at true-up. California’s NEM 3.0, for example, pays out net surplus at a much lower rate than the retail credit you earn monthly.
• Net excess generation (NEG) compensation: If you consistently produce more than you use, find out what your utility pays for NEG. It’s usually 2–4 cents per kWh, far below retail rates, so it’s better to use that energy than bank it for a low payout.

If your true-up falls in December or early in the new year, this is your last chance to shift high-energy activities into this billing period to use banked credits at full value. Run your pool heater, pre-cool or pre-heat your home, charge your EV, or run deferred loads like kiln firing or workshop equipment while your credit balance is high.

If you’re buying a home with an existing solar system, our guide on buying a home with solar explains how net metering transfers and true-up timing affects your first year as the new owner.

Maximize Solar Production in the Final Weeks of the Year

December is typically a low-production month due to shorter days and lower sun angles, but there are steps you can take now to ensure your system performs at its best through year-end.

Clean your panels if needed. Dust, pollen and grime build up over time, and heavy soiling in dusty or polluted areas can cut output significantly. If you’re in a dusty region, near a highway, or haven’t cleaned your panels in over a year, a quick rinse or professional cleaning can yield measurable gains. They don’t need to be spotless. A light cleaning once a year is usually enough.

Check for shading from new growth or seasonal changes. Keep nearby trees trimmed and watch for new growth so branches don’t start casting shade on the array. Deciduous trees lose their leaves in winter, but evergreens and winter sun angles can create new shade patterns you didn’t see in summer.

Monitor your system daily. Monitoring catches problems early. Without it, many owners don’t find out something is wrong until a big electric bill arrives. If production drops suddenly in December, don’t wait until January to investigate. Inverter faults, tripped breakers, and communication errors are easy fixes if caught early.

Understand seasonal performance expectations. Spring and summer typically generate most of your annual production, and the credits banked in those months carry you through fall and winter. December production will be lower than June, but it still contributes to your annual total and your net metering balance before true-up. For more on how solar performs in winter, see our article on solar panels in winter and cloudy climates.

State and Utility Incentives: Confirm Year-End Deadlines and Claim What You’ve Earned

Beyond SRECs and net metering, many states and utilities offer performance-based incentives, rebates, or tax credits that require year-end action. These vary widely, and missing a filing deadline can mean forfeiting money you’ve already earned.

New York pairs a 25% state tax credit (capped at $5,000) with NYSERDA’s NY-Sun per-watt incentive, which together can be worth several thousand dollars on a typical home system. If you installed in 2026 and haven’t filed yet, confirm your eligibility and gather documentation before December 31.

Massachusetts offers a 15% state tax credit up to $1,000, plus SMART, a program that pays a fixed rate per kWh of solar production for 10 or 20 years. SMART payments are issued based on reported production, so verify your production data is current in the program portal.

South Carolina’s state income tax credit covers 25% of a qualifying system’s cost. You can apply up to $3,500 a year or half your state tax bill, whichever is lower, and carry unused credit forward for up to 10 years.

Year-end action items for state incentives:

• Review your state energy office or utility website for performance payment programs and confirm your system is enrolled
• Check whether your state tax credit requires annual filing or carries forward automatically — some states require you to claim it each year even if you can’t use the full amount
• Visit DSIRE and filter by your state to see updated program statuses and deadlines
• If your installer went out of business and you need help with incentive paperwork, our guide on what to do when your installer goes out of business can help

Battery Storage Incentives: Virtual Power Plants and Performance Payments

If you added battery storage to your existing solar system, or you’re considering it before year-end, the incentive landscape has shifted but remains strong in specific states. The 30% federal credit for home batteries under Section 25D also ended for installations completed after December 31, 2025, but state rebates, utility incentives, grid-service payments and leasing can still bring the cost of solar and storage down.

California’s Self-Generation Incentive Program (SGIP) is still the richest state battery incentive. Income-qualified households can receive up to about $1,100 per kWh, which can cover most or all of a typical 13.5 kWh battery. As of early 2026, SGIP’s general-market budget is closed, but its equity waitlist for income-qualified homes is still taking applications.

Connecticut’s Energy Storage Solutions program pays homeowners up to $16,000 upfront, plus performance payments for exporting during peak demand.

In a virtual power plant program, you let the utility draw on your battery during peak events a few dozen times a year, and you’re paid in bill credits or an annual check. If you have a battery and haven’t enrolled in your utility’s VPP program, December is a good time to sign up so you’re earning performance payments in the new year.

For a detailed comparison of home battery options, see our guide on Tesla Powerwall vs SolarEdge batteries.

Tax Filing and Documentation: What to Gather Now for 2026 Returns

Even though the federal residential credit has ended for new installations, existing solar owners who installed in 2025 or earlier may still have unused credit to carry forward. The 25D credit has no dollar cap and no income limit, and any amount you can’t use this year rolls forward to future returns.

Before year-end, gather:

• Your final invoice and proof of payment from your installer, showing the total system cost including all eligible expenses (panels, inverter, battery if installed before 2026, installation labor, permits)
• Proof of when installation was completed, such as the final inspection sign-off. Your Permission to Operate (PTO) letter is useful supporting paperwork, but it isn’t what determines eligibility.
• IRS Form 5695 (Residential Energy Credits) if you’re claiming carryforward credit from a prior year
• Documentation for any state tax credits, including receipts, system specifications, and installer certifications required by your state

If you’re unsure whether you have remaining federal credit to claim, review your 2025 tax return (if you filed already) or consult a tax professional. The credit does not expire if you earned it in 2025 — it simply can’t be claimed for new installations completed in 2026 or later.

State tax credits vary in structure. Some are use-it-or-lose-it annual credits; others carry forward for several years. Confirm your state’s rules at DSIRE or your state’s department of revenue website.

What to Do If You Installed Solar in 2025 But Haven’t Filed Yet

If your installation was completed in 2025, you’re still eligible for the 30% federal credit, but you have to claim it. What matters is when installation was completed, not when you signed the contract or when the utility issued Permission to Operate.

Many homeowners whose installations wrapped up in late 2025 haven’t filed their 2025 tax return yet (since it’s not due until April 2026). That’s fine — you’ll claim the credit on your 2025 return when you file. But now is the time to organize documentation so you’re ready:

• Confirm you have paperwork showing installation was completed in 2025, such as the final invoice or inspection sign-off
• Double-check that your installer provided an itemized invoice showing system cost, including all eligible components
• Review what qualifies: solar panels, inverter, mounting hardware, labor, permitting, battery storage (if charged 100% by the solar system), and electrical upgrades directly related to the system
• Understand that the credit is nonrefundable but carries forward — if your 2025 tax liability is $4,000 and your credit is $9,000, you’ll use $4,000 in 2025 and carry $5,000 forward to 2026 and beyond

You claim it on IRS Form 5695, filed with your return, under qualified solar electric property costs.

If your installer gave you inaccurate information about timing or eligibility, and you’re now uncertain about your credit, consult a tax professional who understands solar incentives before filing. For more on how long solar panels last and what to expect from your investment, see our guide on solar panel lifespan and performance.