If you have been waiting for the federal solar tax credit to make the numbers work, 2026 needs a new plan. The 30 percent credit for homeowner-owned systems ended after December 31, 2025. The good news is that it was never the only money on the table. State and utility rebates, tax exemptions, and performance payments still exist, and they vary a lot by where you live. This guide compares solar rebates and incentives in California, Texas, Florida, and Illinois so you can see what applies to your home and fold it into an accurate estimate.
Quick answer: solar incentives in 2026
- Federal credit: gone for homeowner-owned systems installed after December 31, 2025.
- State income tax credit: none in California, Texas, Florida, or Illinois.
- California: battery rebates (SGIP), a property tax exclusion, and local utility offers.
- Texas: utility and city rebates, plus a property tax exemption.
- Florida: sales tax exemption, property tax exemption, and net metering.
- Illinois: Illinois Shines payments, a utility rebate, and property tax relief.
What Happened to the Federal Solar Tax Credit in 2026?
The federal residential solar credit is gone for homeowner-owned systems installed after December 31, 2025. That includes systems you pay for in cash or with a loan. Do not let any quote or calculator assume it still applies.
None of the four states in this guide replaces it with a broad state income tax credit. Savings now come from rebates, tax exemptions, performance payments, and the bill savings from the system itself. Our look at whether solar still saves money in California shows how that math works without a federal credit.
Who can still use a federal credit?
| Situation | Federal credit in 2026 | What it means for you |
|---|---|---|
| Cash or loan purchase installed in 2026 or later | No homeowner credit | You keep access to state and local incentives |
| System installed in 2025 or earlier | Existing credit may carry forward | Ask a tax professional how unused amounts apply to you |
| Lease or power purchase agreement (PPA) | The system owner may claim a commercial credit | Savings may be passed to you through lower rates, but you may not claim local rebates directly |
Buying vs leasing: why it changes your incentives
The ownership model decides which incentives you can reach. Owning keeps rebates and tax exemptions in your hands. A third-party contract may route some benefits to the company that owns the panels. For a full comparison, read buying vs leasing vs financing solar and whether free solar panels are really free.
How Solar Rebates and Incentives Work Now
Most incentives fall into a few buckets. Knowing which bucket a program sits in tells you when you get paid and what can change it.
The main types of solar incentives
| Type | How it helps | Example |
|---|---|---|
| Direct rebate | Cash or bill credit, often per kilowatt or kilowatt-hour of storage | California SGIP, Texas utility rebates |
| Tax exemption | Keeps solar off your sales tax or property tax bill | Florida sales tax exemption, Texas property tax exemption |
| Performance payment | Pays you over time for energy produced | Illinois Shines |
| Export credit | Credits surplus power sent to the grid | Florida net metering, California net billing |
| Income-qualified program | Lowers or removes upfront cost | Illinois Solar for All, California DAC-SASH |
Why amounts keep changing
- Rebate pools open and close as budgets run out.
- Program levels step down as more homeowners enroll.
- Income-qualified tiers have separate rules and funding.
- Utilities update export credit rates and net metering terms.
Incentives also change what you ultimately pay, not the hardware price. Start from a clear cost baseline such as how much solar costs by state, then subtract the incentives that apply to your address.
Solar Incentives by State at a Glance
| Feature | California | Texas | Florida | Illinois |
|---|---|---|---|---|
| State income tax credit | None | None | None | None |
| Property tax treatment | Exclusion | Exemption | Exemption | Special assessment |
| Sales tax exemption | Not a main lever | Not a main lever | Yes | Not a main lever |
| Main rebate | SGIP (batteries) | Utility and city rebates | Few local city grants | ComEd and Ameren rebate |
| Performance payments | No | No | No | Illinois Shines |
| Export credits | Net billing (NEM 3.0) | Varies by retail provider | Net metering from utilities | Newer net metering terms |
| Best fit | Homes adding a battery | Homes in a rebate-offering utility area | Buyers who value tax exemptions | Buyers who want payments tied to production |
Which states have the best solar incentives in 2026?
There is no single winner. Among these four, Illinois delivers the most direct payments, California rewards battery owners, Florida leans on tax exemptions, and Texas depends on your utility. Nationally, industry roundups often highlight New York, New Jersey, Massachusetts, and Maryland because they pair state credits or rebates with performance payments. Your utility and income level can matter more than the state line.
California Solar Rebates and Incentives in 2026
California has no state solar tax credit, yet it stays incentive-rich through utility programs and tax treatment. The trade-off is net billing, which values exported power far below retail and pushes homeowners toward batteries.
California incentives at a glance
| Program | What it does | Notes |
|---|---|---|
| SGIP (Self-Generation Incentive Program) | Rebates for home battery storage | Highest for income-qualified and high fire risk customers, with general tiers that step down as funds are claimed |
| Active solar property tax exclusion | Adds home value without adding property tax | Confirm current rules with your county assessor |
| Local utility offers | Small rebates or stipends | Examples include SMUD and Rancho Mirage Energy Authority |
| DAC-SASH | Low or no-cost solar for qualifying households | Income and location requirements apply |
| PACE financing | Pay through property tax assessments | A financing tool, not a rebate |
Net billing and why batteries matter
Because exported energy now earns lower credits, self-consumption is king. Pairing panels with storage lets you use daytime power in the evening. Our guides to how NEM 3.0 works and solar battery storage explain the setup most California homes choose.
For California-specific detail, see solar rebates in California for 2026. In Pasadena, the local utility offer is covered in our PWP rebate guide.
Texas Solar Rebates and Incentives in 2026
Texas has no state income tax, so there is no state solar tax credit to gain or lose. Incentives are local and utility-driven, and they can be generous in the right service territory. Two neighbors on different providers can qualify for very different amounts.
Texas utility and city solar rebates
These are published program examples. Funding and rules change, so confirm each one with the provider.
| Provider | Incentive | Published amount |
|---|---|---|
| AEP Texas North (SMART Source) | Solar PV rebate | Up to $6,000 |
| AEP Texas Central (SMART Source) | Solar PV rebate | Up to $5,000 |
| Denton Municipal Electric | Solar rebate | Average award around $4,000 |
| New Braunfels Utilities | Solar rebate | Up to $3,000 |
| City of Sunset Valley | Energy conservation rebate | $1.00 per watt, up to $3,000 |
| Austin Energy | Solar rebate | Up to $2,500 |
| San Marcos Electric Utility | Solar PV rebate | Up to $2,500 |
| Oncor | Residential solar and battery program | Varies by participating contractor |
| Garland Power and Light | Buyback for excess solar | About $0.0669 per kWh |
CPS Energy in San Antonio has also run solar rebate programs, so check its current offer if you are in that service area.
Texas property tax exemption
Texas exempts the added home value from a solar installation from property tax appraisal under the state tax code. Your system can raise your home value without raising your property taxes, which matters in a state with relatively high property tax rates. Ask your county appraisal district whether an application is required.
Texas export credits and buyback plans
Texas does not have one statewide net metering rule. What you earn for surplus power depends on your retail electricity provider and plan. Compare buyback terms before you choose a plan, because the rate can change your payback. For installed pricing, see solar installation cost in Texas.
Florida Solar Incentives in 2026
Florida also has no state income tax, so there is no state credit. It offers two clean tax exemptions plus net metering, which together make solar attractive even without a rebate check.
Florida incentives at a glance
| Incentive | What it does | Typical value |
|---|---|---|
| Sales tax exemption | Solar energy systems are exempt from state sales tax | Several hundred to over $1,000, depending on system size |
| Property tax exemption | Added value from solar does not raise your assessment | Ongoing savings every year |
| Net metering | Investor-owned utilities credit exported energy toward your bill | Check your utility’s current credit terms |
| PACE financing | Pay through property tax assessments | Financing tool, not a rebate |
| Local city programs | Occasional grants such as Boynton Beach and Dunedin | Up to $1,500 and $2,500 as published, so confirm they are still open |
Retail net metering is effectively an ongoing incentive, and it is one reason Florida solar can pay back steadily without a cash rebate. For pricing in Miami, Tampa, Orlando, and Jacksonville, see solar cost in Florida.
Illinois Solar Rebates and Incentives in 2026
Illinois takes the most different approach of the four. Rather than a tax credit, it pays you for the clean energy your system produces, then layers a utility rebate and property tax relief on top.
Illinois incentives at a glance
| Program | What it does | Notes |
|---|---|---|
| Illinois Shines (Adjustable Block Program) | Buys the renewable energy credits your system generates for 15 years | Paid through an approved vendor, with block prices that step down as capacity fills |
| Distributed generation rebate | Utility rebate per kilowatt for systems with a smart inverter | ComEd and Ameren territories, so confirm the current amount |
| Special property assessment | Shields you from a property tax increase tied to solar | An application may be required |
| Illinois Solar for All | Lowers or removes upfront cost | Income-qualified households |
Illinois Shines and what it can be worth
Estimates for an average home often land around $10,000 to $12,000 in credit value over 15 years, but pricing varies by block, utility territory, and vendor. Earlier enrollment generally earns more, so ask for the credit price in writing.
Net metering changes in Illinois
Illinois has been shifting how exports are credited for newer systems, which makes the distributed generation rebate and Illinois Shines more important to your total savings. For statewide numbers, read our Illinois solar incentives and costs guide. To see these programs on a real project, check our solar estimate in Glenview, IL.
How to Stack Incentives Without Getting Burned
The homeowners who save the most treat incentives as a stack, not a single line item.
- California: property tax exclusion plus an SGIP battery rebate where eligible.
- Texas: property tax exemption plus any rebate your utility or city offers.
- Florida: sales tax exemption plus property tax exemption plus net metering.
- Illinois: Illinois Shines plus the distributed generation rebate plus property tax relief.
Read each program’s rules, because some cannot be combined and others reduce one another. Watch timing too, since utility funds often run out mid-year.
What to ask your installer
- Which incentives are counted, listed by program name?
- What is the price before and after incentives, shown separately?
- Who applies for each program, and who is paid?
- What happens if the funding runs out before approval?
Our guides to reading a solar contractor estimate and the solar estimate checklist show where these items belong on a proposal.
Getting an Estimate That Reflects Your Real Incentives
Because incentives vary by state and even by utility, a generic online quote can be off by thousands of dollars in either direction. The number that matters is your net cost after the rebates and exemptions that truly apply to your address, at this year’s program levels. A good estimate names each incentive it counts, shows the price before and after, and never quietly assumes a federal credit that no longer exists.
Ready to see your real numbers? Start with a free solar estimate built around your state’s 2026 programs, or run your own scenarios in the Axia solar calculator.
Turning 2026 Incentives Into Real Savings
The federal credit era is over for homeowner-owned systems, but going solar in 2026 still comes with real financial support if you know where to look. California leans on battery rebates and its property tax exclusion. Texas rewards you through local utility rebates and a property tax exemption. Florida stacks sales and property tax exemptions with net metering. Illinois pays you for the energy you produce. None of it is automatic, so price your system honestly and add only the incentives that truly apply to your home.
Frequently Asked Questions
Is the federal solar tax credit available in 2026?
Not for homeowner-owned systems. The 30 percent residential credit expired for systems installed after December 31, 2025. Homeowners who installed earlier may still carry forward unused credit under existing tax rules, so ask a tax professional about your situation. Any quote or calculator that still assumes the credit for a new system is out of date.
Is there a Texas solar tax credit or rebate in 2026?
Texas has no state income tax and no state solar tax credit. Rebates come from certain utilities and cities, such as Austin Energy, AEP Texas, San Marcos, New Braunfels, and Denton, and Texas exempts the added home value from property tax. Availability depends on your utility, so confirm before you count on a number.
Which states have the best solar incentives in 2026?
It depends on your goals. Among California, Texas, Florida, and Illinois, Illinois offers the most direct payments through Illinois Shines, California is strongest for battery owners, Florida leans on tax exemptions, and Texas depends on your utility. Industry roundups often also point to New York, New Jersey, Massachusetts, and Maryland.
Are there solar rebates without the federal tax credit?
Yes. State and utility rebates, sales and property tax exemptions, and performance payments such as Illinois Shines are separate from the federal credit and are still available in 2026. Stacked together, they can still reduce your real cost meaningfully.
Can I still get the federal credit with a solar lease or PPA?
Indirectly. In a lease or power purchase agreement, the company that owns the system may claim a federal commercial credit and pass some savings to you through lower rates. You may give up direct access to local rebates in that arrangement, so compare both paths before you decide.
Do solar incentives lower the sticker price of the system?
Not directly. Hardware and installation prices stay the same. Incentives reduce what you ultimately pay through rebates, bill credits, performance payments, or avoided taxes. That is why it helps to start from a cost baseline and then subtract what applies.
How do I confirm a solar rebate is still available?
Check the program page for your utility or state administrator, since funding opens and closes. Then ask your installer to list each incentive by program name on the written proposal and show pricing before and after incentives.
Does adding solar raise my property taxes?
In California, Texas, Florida, and Illinois, the added value from solar is shielded from a property tax increase through an exclusion, exemption, or special assessment. Your home value can rise while your tax bill stays based on the pre-solar assessment. Verify the current rule and any required application with your county.
Do I need a battery to get California solar rebates?
For the main statewide rebate, yes. SGIP pays for battery storage rather than panels. Property tax benefits and some local utility incentives do not require a battery.
Is solar exempt from sales tax in Florida?
Yes. Florida exempts solar energy systems from state sales tax, which can save several hundred to over a thousand dollars depending on system size.