Solar Battery Tax Credit & Rebates 2025 Guide

Learn how the federal 30% tax credit and state rebate programs can slash the cost of solar generators, batteries, and backup power systems. We’ll break down who qualifies, how much you can save, and where to find the latest programs.

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🚨 Big Update: The Federal Tax Credit Ends December 31, 2025

As of July 4, 2025, Congress passed the “One Big Beautiful Bill,” which ends the 30% federal Residential Clean Energy Credit for solar panels and home battery systems. That means:

• ✅ Systems installed and placed in service by December 31, 2025 will still qualify for the 30% credit.
• ❌ Systems installed on or after January 1, 2026 will no longer qualify for any federal residential solar or battery tax credit.
• 📄 You can still claim the credit on your 2026 tax return if the system was installed in 2025.

This is a hard deadline — unlike the old version of the credit, there’s no phase‑down period in 2033 or 2034. If you’ve been thinking about investing in a solar generator, battery backup system, or full solar array, 2025 is the last year to secure that 30% savings.

💡 What this means for you: If your system isn’t fully installed and operational by the end of 2025, you’ll miss out on thousands in savings.

Thinking about buying a solar generator or home battery backup system? Here’s the good news: in 2025, there are federal and state programs that can slash your out-of-pocket costs by thousands of dollars. The federal Residential Clean Energy Credit alone can cover 30% of the cost, and dozens of states have rebates, tax breaks, or even performance payments that stack on top of that.

But navigating all those programs can feel confusing. Which products qualify? Do portable solar generators count, or is it just rooftop solar? How do you claim the credit, and what paperwork do you need? This guide breaks it all down step by step so you’ll know exactly how much you can save and how to make sure you don’t leave money on the table.

We’ll walk through the federal 30% tax credit, state-level rebates and tax programs, and even utility-run “virtual power plant” programs that actually pay you for owning a home battery. Whether you’re a homeowner, a renter, or living off-grid, you’ll come away knowing what incentives apply to you—and how to claim every dollar you qualify for.

The Federal Solar & Battery Tax Credit (Residential Clean Energy Credit)

If you’ve been looking at the price tag on a solar generator or home battery system and thinking, “That’s a lot of money,” you’re not wrong. The good news? The federal government has been helping cover the cost for years through what’s now called the Residential Clean Energy Credit. And in 2025, it’s better than ever — you can get 30% of your purchase price back as a tax credit on qualifying equipment.

This credit is simple in concept but powerful in impact: you buy a qualifying system, you claim the credit on your taxes, and it directly reduces what you owe Uncle Sam. Spend $5,000 on an eligible solar generator setup and you’ll see $1,500 taken off your tax bill. Spend $10,000 and you’re looking at $3,000 in savings. There’s no maximum limit — whether you’re buying a single portable battery or an entire whole-home backup system, 30% is 30%.

What Qualifies for the Federal Credit?

• Solar panels and accessories: Rooftop panels, ground-mounts, or even portable folding panels count they don’t have to be on your roof to qualify.
• Battery storage systems: Starting in 2023, any battery system with at least 3 kilowatt-hours of storage qualifies, even if you don’t have solar panels connected. That’s a game-changer for people buying portable solar generators or home batteries just for blackout protection.
• All the parts that make the system work: Inverters, charge controllers, cables, racks, wiring, and yes even installation labor if you hire an electrician to set up a transfer switch or wire it into your panel.

There’s one key thing the IRS insists on: the equipment must be new and installed for use at your residence in the U.S. It doesn’t have to be a primary home a vacation home counts and even renters can qualify if they buy and install the equipment where they live.

How Do You Claim It?

You don’t need a stack of forms and an accountant. Claiming this credit is done on a single sheet IRS Form 5695. You’ll enter what you spent on eligible equipment and installation, take 30%, and that number goes right onto your 1040 as a tax credit. If your credit is bigger than your tax bill, the leftover rolls over to next year.

One thing to note: you claim the credit for the year the system is put into service not just when you buy it. If you ordered a battery in November 2024 but it didn’t ship and you didn’t start using it until February 2025, you’ll claim it on your 2025 taxes.

How Much Can You Really Save?

Here’s a quick look at what 30% off looks like in real dollars:

System Cost	Federal Credit (30%)	What You Really Pay
$3,000	$900	$2,100
$5,000	$1,500	$3,500
$10,000	$3,000	$7,000

These numbers aren’t just for people with rooftop solar and Tesla Powerwalls. They apply to a lot of the equipment readers like you are actually buying from portable solar generators like EcoFlow and Bluetti to larger plug-in home battery systems. The catch is the battery capacity: it must be at least 3 kWh to qualify. That means the smaller “camping” batteries won’t count, but the bigger backup units absolutely do.

Bottom line: if you’re spending real money on backup power, the government is willing to pick up nearly a third of the tab. And that’s before you even think about state programs or utility rebates, which can stack on top of this credit and cut the cost even further.

Do Portable Solar Generators Qualify?

This is the number one question people ask me: “Does my portable solar generator qualify for the tax credit, or is this only for rooftop solar?” And here’s the simple answer — yes, portable solar generators DO qualify as long as they meet the basic rules the IRS sets out.

The government doesn’t care if your solar panels are on your roof, on the ground, or leaning against a fence. What they care about is that you’re installing new solar or battery equipment for use at your home in the U.S. That means an EcoFlow Delta Pro Ultra sitting in your garage, paired with foldable solar panels on sunny days, counts.

What Makes a Portable System “Qualify”?

• It must have a battery of at least 3 kilowatt-hours (3,000 Wh): This is the magic number. If your battery is smaller (like a little camping power station), it won’t qualify. But larger systems like the EcoFlow Delta Pro, Bluetti AC500, or Goal Zero Yeti 3000X easily clear this mark.
• It must be new: The IRS doesn’t give credits for used or refurbished equipment — you need to buy new from a retailer or manufacturer.
• It has to be “installed” for home use: Don’t get hung up on the word installed — this doesn’t mean bolting it to the wall or pulling a permit. It simply means you’re using it to power your home, even if you’re plugging your fridge or lights into it during a blackout.

That’s it. You don’t have to hardwire the generator into your panel for it to count. You don’t need to hire an electrician (unless you want to). If you keep your solar generator at your home and use it for backup or daily power, it meets the IRS’s “installed in connection with your residence” rule.

Do the Solar Panels You Plug Into It Count Too?

Yes. If you buy solar panels to charge your generator — even portable, foldable ones — those panels count toward the tax credit too. The cables, extension cords, and adapters you need to connect everything also qualify. The whole setup is eligible as long as it’s part of your system and used for your home.

Real Example

Let’s say you buy a Bluetti AC500 + 2 B300 batteries (for a total of 6 kWh storage) for $5,000 and pair it with two 400W folding solar panels for $1,000. Total cost: $6,000. Come tax time, you’ll claim the entire $6,000 on Form 5695 not just the batteries, but the panels and accessories too. The IRS takes 30% of that, and you get an $1,800 tax credit.

Bottom line: if you’re buying a serious portable solar generator not just a tiny camping battery, but one of the larger backup systems the federal tax credit is absolutely on the table for you.

State-Level Solar & Battery Rebates and Credits

The federal 30% tax credit is the big one, but it’s not the only program out there. Many states sweeten the deal with their own rebates, tax credits, or sales and property tax breaks. Some states even have programs that will literally pay you to install a battery because it helps the grid.

Here’s how this section works: click on your state below to see exactly what’s available. If your state isn’t listed, it simply means there are no state-level rebates or credits beyond the federal program — but you can still claim the 30% federal credit and may find local utility rebates by calling your power company.

For the states that do have programs, you’ll see a quick bullet list of highlights — tax credits, rebates, exemptions and links to official pages so you can read the fine print right from the source.

State Solar & Battery Incentives

Note: If your state is not listed below, it doesn’t currently offer a dedicated solar or battery rebate or tax credit program. You can still claim the 30% federal credit, and you may find local utility rebates by calling your power company or visiting DSIREUSA.org.

California

• 💰 SGIP Rebates: Up to $850/kWh for batteries (and up to $1,000/kWh for Equity Resiliency customers — can cover nearly the full cost).
• 🏡 Property Tax Exclusion: Solar installations don’t raise property taxes.
• ⚡ Net Metering: Credits for excess solar sent to the grid under NEM 3.0.

California SGIP Program

New York

• 💳 25% State Tax Credit: Up to $5,000 for residential solar equipment.
• 📉 Sales Tax Exemption: 4% state sales tax waived on solar and batteries.
• 🏠 15-Year Property Tax Exemption: Solar upgrades won’t increase taxable value.

NY-Sun Program

Massachusetts

• 💳 15% State Tax Credit: Up to $1,000 for residential solar systems.
• 🔋 ConnectedSolutions: Utilities pay up to $1,200/year for batteries enrolled in the grid support program.
• 🛒 Sales & Property Tax Exemptions: No sales tax and no property tax increase for 20 years.

Mass Save ConnectedSolutions

Florida

• 🛒 Sales Tax Exemption: No 6% state sales tax on solar panels and batteries.
• 🏡 100% Property Tax Exemption: Solar/battery upgrades won’t raise assessed value.
• 🔌 Local Rebates: Some municipal utilities (e.g., Lakeland Electric) offer up to $1,000 for batteries.

Florida Dept. of Revenue – Solar Exemption

Texas

• 🏡 Property Tax Exemption: 100% exemption on added value from solar or battery systems.
• ⚡ Utility Rebates: Utilities like Austin Energy & CPS San Antonio offer solar rebates and occasional battery pilots.
• 🌐 Virtual Power Plants: Tesla’s Texas VPP pilot pays Powerwall owners for sharing stored energy.

Texas Solar Info – State Programs

Hawaii

• 💳 35% State Tax Credit: Up to $5,000 per system (one of the nation’s highest).
• 🔋 Battery Bonus Program: Hawaiian Electric pays homeowners for battery installations that support the grid.
• ☀️ Smart Export: Night-time solar export credits for grid-tied systems.

Hawaiian Electric Battery Bonus

Arizona

• 🛒 Sales Tax Exemption: No state sales tax on solar panels and related gear.
• 🏡 Property Tax Exemption: Solar/battery value won’t increase your home’s taxable value.
• ⚡ Utility Rebates: Tucson Electric & SRP occasionally offer solar or battery rebates.

Arizona Residential Solar Programs

Colorado

• 💳 State Tax Credit: Some storage projects qualify (especially with solar installs).
• 🛒 Sales Tax Exemption: Solar equipment exempt from state sales tax.
• ⚡ Utility Programs: Xcel Energy and others offer rebates or pilot programs for batteries.

Colorado Energy Office

New Jersey

• 🛒 Sales Tax Exemption: No sales tax on solar panels and qualifying equipment.
• 🏡 Property Tax Exemption: Solar systems don’t increase your taxable value.
• ⚡ SREC-II Program: Credits you for solar production (if you install panels).

New Jersey Clean Energy Program

Utility & Virtual Power Plant Programs

Federal and state programs aren’t the only way to save money on a battery system. More and more utilities are offering something new: they’ll actually pay you for having a home battery. These programs go by names like “demand response,” “grid services,” or the trendy term virtual power plant (VPP).

Here’s the idea: during heat waves, winter storms, or other times when the grid is stretched thin, utilities can tap into a network of home batteries for extra power instead of firing up expensive peaker plants. In return, they reward homeowners — sometimes with big checks, sometimes with annual credits on your bill.

How It Works

• Enrollment: You sign up through your utility or battery manufacturer (Tesla, Enphase, and others run VPP programs). Usually, you’ll need a Wi‑Fi connected battery so the utility can signal it when to discharge.
• Participation: When the grid needs help, the utility “calls an event.” Your battery pushes a set amount of power back to the grid for a few hours — and you still keep a reserve for blackout protection.
• Compensation: You get paid — either per kWh your battery provides or as a seasonal flat payment for being available.

Examples Around the Country

• 💰 California: PG&E and Southern California Edison work with Tesla’s Virtual Power Plant. Powerwall owners have earned hundreds of dollars a year during peak events.
• 💰 Massachusetts & Rhode Island: The ConnectedSolutions program pays up to $1,200 per summer for a typical 10 kWh battery enrolled in grid support events.
• 💰 Texas: Tesla’s VPP pilot pays Powerwall owners for sharing stored energy during peak ERCOT demand — and some electric co‑ops are adding upfront cash just for joining.
• 💰 Vermont: Green Mountain Power essentially “leases” your battery in exchange for monthly bill credits, saving homeowners thousands over time.

These programs don’t replace the federal or state tax credits they stack on top of them. Think of it this way: the tax credits help you buy the battery, and the VPP programs help the battery pay for itself.

Not every battery qualifies (many utilities require certain UL‑listed models with remote control capability), but the trend is spreading fast. If you’re getting a battery, always check your utility’s website or ask the installer: “Do you have a battery incentive or virtual power plant program I can join?”

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Which Products Qualify for the Tax Credit?

Note: All of these products meet the IRS’s 3 kWh minimum battery requirement and are eligible for the 30% federal Residential Clean Energy Credit when purchased new for home use. Accessories like solar panels, cables, and integration hardware also qualify when bought as part of your system.

✅ EcoFlow Delta Pro Ultra – Model: EFDPULTRA-12K

EcoFlow’s flagship whole-home power station with a 12 kWh base kit. Expandable to 90 kWh with extra batteries and designed for both home and portable use.

✅ EcoFlow Delta Pro – Model: EFDELTPRO-3.6K

The original Delta Pro with a 3.6 kWh capacity. Portable yet powerful, and a great entry point for the tax credit if you don’t need the Ultra.

✅ EcoFlow Extra Battery – Model: EFDELTABATT-3K

Add-on battery modules for the Delta Pro and Delta Pro Ultra. Each battery adds capacity — and they count toward the credit when purchased with a qualifying system.

✅ Bluetti AC500 + (2) B300K Expansion Batteries – Model: AC500+2B300K

Bluetti’s modular powerhouse: the AC500 inverter hub paired with two B300K expansion batteries, delivering a combined 5,529.6 Wh of LiFePO4 storage. This bundle clears the IRS’s 3 kWh threshold and fully qualifies for the 30% federal Residential Clean Energy Credit. With 6 x 5,000W AC outlets (10kW surge), it’s built for home backup, RV trips, and blackout protection.

✅ Goal Zero Yeti PRO 4000 – Model: YetiPRO-4000

Goal Zero’s most advanced power station yet, the Yeti PRO 4000 packs a 4,000 Wh LiFePO4 battery with a 3,600‑watt AC inverter (7,200‑watt surge). It’s expandable with additional tanks for even more runtime and works as a true home backup system, RV power hub, or off‑grid solution. Because it easily clears the IRS’s 3 kWh battery threshold, it qualifies for the 30% federal Residential Clean Energy Credit when purchased new.

✅ EcoFlow 400W Solar Panel – Model: EF400W-SP

EcoFlow’s foldable 400 W solar panels. Panels, cables, and mounting hardware all qualify for the credit when used with a battery system.

✅ EcoFlow Smart Home Panel 2 – Model: EF-SMARTPANEL2

Integrates EcoFlow systems with your home’s electrical circuits. Installation labor for this panel also counts toward the credit.

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Final Thoughts on Solar & Battery Tax Credits

When you step back and look at all the incentives stacked together, the math is almost too good to ignore. The federal 30% Residential Clean Energy Credit knocks thousands off the price right away. State rebates and sales tax exemptions can cut even more. And some utility programs will literally pay you year after year for letting your battery help support the grid.

The bottom line? If you’ve been waiting to buy a solar generator, home battery, or an expandable system like the EcoFlow Delta Pro Ultra or Bluetti AC500 bundle 2025 is the time to do it. The savings are real, the rules are clear, and these systems deliver the kind of peace of mind you can’t put a price tag on when the lights go out.

Want to take the next step?

• ✅ Download our Hurricane Preparedness Checklist — it’s free and will help you plan smarter for the season ahead.
• ✅ Browse the qualifying products above and pick the system that fits your home — every one of them is eligible for the 30% credit when bought new.

By this time next year, you could have a reliable backup power setup in your garage, a federal tax credit on your return, and the confidence that you’re ready for whatever the next storm throws at you.

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Frequently Asked Questions

Are batteries included in the solar tax credit?

Yes — as of 2023, standalone batteries are included. The IRS now allows any new battery storage system of at least 3 kWh to qualify for the 30% Residential Clean Energy Credit, even if it’s not paired with solar panels.

Is there an income limit for the solar battery tax credit?

No. There’s no income cap on claiming the credit. As long as you purchase qualifying equipment and have a tax liability to offset, you can claim it — whether you make $40,000 or $400,000.

Does a Tesla Powerwall qualify for tax credits?

Yes. The Tesla Powerwall easily meets the IRS requirements (13.5 kWh battery). It’s eligible for the 30% federal credit and most state incentives when purchased new and installed at your home.

What disqualifies you from a solar tax credit?

Used or refurbished equipment won’t qualify. Neither will batteries under 3 kWh. And if you buy the system for a rental property where you don’t live, you can’t claim the credit. The credit is for new equipment installed at your residence only.