Congress Puts 30% Residential Solar Tax Credit in Jeopardy in 2025
Updated: 6.2.2025
Have you heard the residential solar tax credit 2025 news? In May 2025, Congress proposed a federal budget and tax bill that would eliminate the 30% residential solar tax credit—also known as the Federal Investment Tax Credit (ITC)—by the end of this year, ending a credit that’s supported energy independence for decades.
The proposed rollback affects both solar panel systems and home battery storage, putting thousands of dollars in potential savings at risk for homeowners.
If you’ve considered solar energy for your home, 2025 is the time to move forward. Acting now allows you to maximize your solar incentive savings and secure thousands of dollars in reduced system costs before it is too late. With in-house experts in permitting, interconnection, and incentives, StraightUp Solar is here to guide your project with professionalism every step of the way.
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Residential Solar Tax Credit 2025 Update
What Changes Have Been Proposed?
For years, the Residential Solar Tax Credit helped millions of homeowners save thousands on the cost of solar systems and batteries, by taking 30% off the total cost of the solar photovoltaic (PV) system. This federal tax credit provides a dollar-for-dollar reduction against your tax liability for the year your system is installed, and any unused credit can be rolled forward to future years. Under current law, the tax credit is set through 2032.
But that could change. Proposed legislation in the U.S. House of Representatives aims to:
- Eliminate the 30% residential solar tax credit by the end of 2025
- Accelerate the phase-out of the solar tax credit for businesses
- Eliminate the electric vehicle (EV) tax credit
While this bill still needs to pass the Senate and be signed by the President, it’s moving fast—and your window to secure the tax credit is narrowing. Your array must be “placed in service” by the December 31, 2025 deadline.
Non-Residential Solar Tax Credit Term Shorted in House Budget Bill
The House-passed budget bill drastically curtailed the life of the solar tax credit available for businesses, schools, and nonprofit organizations. The legislation requires solar projects to start construction within 60 days of the bill’s passage and must be placed in service by 2028. Experts predict that Congress will pass the budget bill this summer, meaning now is the time to get your solar PV system contract signed to begin the construction timeline. Start a quote for your business or organization today!
Disclaimer: We are not tax professionals, we are solar experts. Please consult with your tax advisor to see how the Federal Tax Credit can work best for you.
Solar Powers American Energy Independence
For generations, energy independence has been a core American ideal—and in our current moment, homeowners have more power than ever to take control of how they produce and use energy. Installing solar panels allows you to generate your own electricity, reduce your reliance on the utility grid, and protect yourself from unpredictable rate hikes. Visit the Solar Energy Industries Association (SEIA) website to learn how this bill prevents our opportunity to control our energy future.
Utility Costs Continue to Rise Across Illinois & Missouri
- Ameren Illinois announced a summer 18-22% total bill increase for homeowners beginning on June 1, 2025 (customers will begin seeing it on their bills in July) and running through September 30, 2025.
- ComEd residential customers in Illinois will see on average a $10.50/month bill increase, effective June 1, 2025.
- Ameren Missouri received approval for a 15% rate increase, with more on the horizon after a new Missouri law enables them to charge customers for Construction Work in Progress (CWIP) to cover their expenses for building new power plants, prior to project completion.
Source: Brattle Economic Analysis of Clean Energy Tax Credits
Solar Locks in Utility Rates for Long-Term Energy Security
As rates climb, solar offers a powerful solution: it allows you to lock in your energy costs and avoid future increases. With a solar energy system, you produce electricity at a predictable cost, offering long-term peace of mind and financial stability.
Solar + Battery
Pairing your solar installation with battery storage can provide even greater energy resilience. You’ll have backup power during outages and the ability to use more of your own energy on your own terms.
Choosing solar is more than a smart financial decision—it’s a step toward greater energy independence, energy security, and local resilience for American families.
5 Smart Reasons to Choose Solar in 2025
- Secure the full 30% residential solar tax credit before proposed policy changes take effect.
- Stay ahead of current and future utility rate increases in both Missouri and Illinois.
- Reserve your place on StraightUp Solar’s 2025 solar installation queue before end-of-year deadlines and demand spikes.
- Produce your own electricity while lowering your energy bills and adding long-term value to your home.
- Contribute to a cleaner energy future by reducing reliance on fossil fuels—one rooftop at a time.
Time is critical. If passed, the current bill would make any delay costly. Your solar PV system would need to be “placed in service” before the end of the year. A signed contract now helps ensure you still qualify for federal incentives.
Advocate for Solar: Make Your Voice Heard
The proposed rollback of the residential solar tax credit 2025 is not yet law—but the timeline is moving quickly. This legislation must still pass the Senate before it can be signed into law. That means there’s still time to make a difference.
If you believe in the value of energy choice, local resilience, and long-term cost savings for American families, now is the moment to speak up. Contact your elected officials today to share why solar matters to you. Your voice can help preserve critical clean energy incentives that support homeowners and businesses, create jobs, and strengthen our economy.
Looking for a quick, easy way to advocate? Learn how you can take action, including resources to connect you with your representatives, on the Save Main Street Solar website.
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Why Choose StraightUp Solar?
Since 2006, we’ve brought more than 3,000 solar installations to light for homeowners and businesses across Missouri and Illinois.
When you work with us, you get:
- A certified B Corp that prioritizes people and planet daily
- A team that lives and works in your community
- Unparalleled expertise for permitting, interconnection, and incentives
- Top-tier solar equipment and warranties
- Battery storage options to maximize energy security
- More than half of our team is NABCEP-certified
- Peace of mind that our full-time Service Team has your back
Take Control of Your Energy Future Today!
Don’t wait for incentives to disappear. The sooner you get installed, the greater your chances to secure your 30% residential tax credit in 2025 and start your solar journey with confidence. Our expert team at StraightUp Solar will walk you through every step—from quote to install and beyond—for maximum savings and to lock in long-term energy stability.
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