[RE-wrenches] Resi tax credit

[Harry Mahon]

I would seek guidance from a tax attorney as noted.

I do not believe that is correct information for residential non-TPO systems if the implication is they can be placed in service AFTER Dec 31, 2025 if 5% spent before that date - the recent Treasury guidance is NOT applicable to 25D tax credits, only 45Y and 48E.

Sections 45Y and 48E Beginning of Construction Notice<https://www.irs.gov/pub/irs-drop/n-25-42.pdf>

25D eligibility goes away completely on Dec 31 2025, and system must be operational (either placed in service or possibly tested operational but waiting for PTO) by then to claim credit.

Best regards -
Mike


Michael Mahon (he/him)
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From: RE-wrenches <re-wrenches-bounces at lists.re-wrenches.org> On Behalf Of Kristopher Schmid via RE-wrenches
Sent: Monday, August 18, 2025 12:14 PM
To: RE-wrenches <re-wrenches at lists.re-wrenches.org>
Cc: Kristopher Schmid <solman at legacysolar.com>
Subject: [RE-wrenches] Resi tax credit

Hi All,

Just received the following in an email from my local state solar lobbying group.

---snip---
Solar projects 1.5 MW (AC) or less remain eligible to use the 5% Safe Harbor rule.

That means:

If at least 5% of project costs are incurred (equipment deposits, racking, inverters, modules) before December 31, 2025, the project qualifies as "begun construction."

Alternatively, starting physical work-like installing racks on a rooftop-also establishes eligibility.

Once placed in service, these projects may be eligible the full 30% Residential Clean Energy Credit. Contact a tax attorney for further details.
---snip---

Has anyone heard a similar interpretation recently?  A little scary that they say "may be eligible".

Thanks,
Kris



Shine On!

Kris Schmid
Legacy Solar, LLC
137 West 1st Avenue
Luck, WI 54853
www.legacysolar.com<http://www.legacysolar.com/>
715-653-4295
NABCEP Certified PV Installation Professional
Licensed Wisconsin Master Electrician
BSEE
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