The phrase “Big Beautiful Bill Solar Tax Credit” is suddenly everywhere, as recent legislative changes threaten to upend the landscape for solar energy in America. As of late June 2025, the Senate has passed a dramatic revision of the so-called “Big Beautiful Bill,” which directly targets federal incentives for solar power. The bill, which has already cleared the House, is now on its way to the President’s desk and could become law before the end of the summer. With the Big Beautiful Bill Solar Tax Credit at the center of the storm, homeowners, businesses, and the solar industry are scrambling to understand the impact.
What’s Inside the Big Beautiful Bill Solar Tax Credit Changes?
The most significant change under the Big Beautiful Bill Solar Tax Credit is the abrupt end to the federal solar tax credit for residential installations. Previously, homeowners could claim a 30% credit on the cost of their solar systems, with a gradual phase-out planned over the next decade. Under the new bill, that incentive will expire entirely on December 31, 2025—meaning only systems installed and operational by year’s end will qualify. For commercial solar projects, the rules are even stricter. Projects must begin construction within 60 days of the bill becoming law, and only those completed by December 31, 2028, will be eligible for any tax credits. There’s also a new “foreign entity of concern” rule, which disqualifies projects that use materials from countries like China.
The solar industry is sounding the alarm. Installers, consultants, and energy advocates warn that the Big Beautiful Bill Solar Tax Credit changes could slow the adoption of solar energy across the country. In California, solar consultant Cynthia Alvidrez described the mood as “panicked,” with homeowners rushing to get systems installed before the deadline. The loss of the tax credit is expected to make solar less attractive for both residential and commercial customers, increasing payback periods and reducing returns on investment.
How Will the Big Beautiful Bill Solar Tax Credit Impact You?
For homeowners, the end of the Big Beautiful Bill Solar Tax Credit means a much shorter window to take advantage of federal incentives. A typical residential solar installation that would have qualified for a 30% credit under the old rules will now only get that benefit if it’s up and running before the end of 2025. After that, the cost of going solar will rise significantly.
Businesses face an even tougher road. The requirement to start construction within 60 days of the bill becoming law is nearly impossible for most commercial projects, which often take months or years to plan and permit. The new “foreign entity of concern” rule adds another layer of complexity, as many solar panels and components currently on the market are manufactured in China. Companies that can’t prove their supply chains are free of Chinese materials will be ineligible for the tax credit.
The Senate’s version of the Big Beautiful Bill Solar Tax Credit also includes a new excise tax on wind and solar projects that come online after 2027, unless they can demonstrate a supply chain free of Chinese components. This could raise the cost of new projects by 10–20% on top of losing the tax credits, making solar and wind energy less competitive with traditional fossil fuels.
Read also-Big Beautiful Bill Tax Cuts by Income: 2025’s Historic Relief for Workers and Families
Key Points Summary
- Residential Solar: Federal tax credit ends December 31, 2025—only systems installed by then qualify.
- Commercial Solar: Must start construction within 60 days of the bill becoming law and be completed by December 31, 2028.
- Foreign Entity of Concern: Projects using materials from China are disqualified from tax credits.
- New Excise Tax: Additional tax on wind and solar projects after 2027 unless supply chain is free of Chinese components.
- Industry Reaction: Solar installers and advocates are urging customers to act fast, warning of higher costs and longer payback periods.
What Should You Do Now?
With the Big Beautiful Bill Solar Tax Credit set to expire soon, time is running out for homeowners and businesses to take advantage of federal incentives. Solar installers are bracing for a surge in demand as customers rush to beat the deadline. If you’ve been considering solar, now is the time to act. Contact a local installer to discuss your options and lock in your savings before the rules change for good.
If you want to secure your solar tax credit, don’t wait—reach out to a solar professional today and get started on your installation before the Big Beautiful Bill Solar Tax Credit disappears.