The Federal Investment Tax Credit (ITC) has been a game-changer for homeowners looking to install solar panels and battery storage. As part of the Inflation Reduction Act (IRA), the 30% tax credit is helping thousands of Americans transition to renewable energy while significantly reducing upfront costs. However, with the current political landscape, there is concern that these incentives may be at risk of being reduced or eliminated in the near future.
Current federal solar and battery incentives
As of 2025, homeowners installing solar panels or battery storage can claim:
- 30% Federal Investment Tax Credit (ITC) — this applies to both solar and standalone battery storage.
- No cap on savings — the credit applies to both residential and commercial projects with no maximum limit.
- Carry-forward benefit — if the tax credit exceeds your tax liability for the year, it can be rolled over to future years.
Two possible futures
| Scenario | What it means |
|---|---|
| Incentives stay in place | If support for clean energy policies holds, the 30% ITC is expected to remain in effect through 2032 — providing long-term stability for homeowners and businesses. New state-level incentives could further enhance savings. |
| Incentives are rolled back | If political shifts lead to a rollback of the IRA's clean energy provisions, the 30% ITC could be reduced or eliminated before 2032, making solar and battery installations more expensive. |
Importantly, if those changes occur, homeowners who have already installed systems will still receive their tax credit — but future installations may lose this valuable benefit.
Why homeowners should act now
While no one can predict the future with certainty, one thing is clear: solar and battery incentives peak in 2025, making it an ideal time to invest. By acting now, homeowners can secure their 30% ITC while ensuring long-term energy savings and protection from rising utility costs.
Final thoughts
The Federal ITC remains one of the most powerful incentives for going solar, but its future depends on political decisions in the coming years. If you've been considering solar panels or battery storage, now is the time to lock in your savings before potential changes take effect.
Take advantage of these incentives while they last
Contact Solar Wave today for a free quote and we'll show you exactly what the current credits are worth on your project.
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Steven Weaver
Steven is the founder of Solar Wave and has dedicated the last seven years of his career to the solar industry. After consulting for multiple solar companies across the US he founded Solar Wave in Denver, Colorado. Solar Wave is on a mission to continue the rapid deployment of residential and commercial solar in Colorado by offering the best solar equipment and installation services at the lowest prices possible.
