State-by-State Solar Rebates & Incentives Guide

Part IExecutive Summary

Commercial and utility-scale solar economics in late 2026 are set by a compressed federal calendar and by a patchwork of state programs that are, in several important markets, approaching their own cliffs. This guide maps both layers for all 50 states and the District of Columbia, separates what has been verified on primary or dated sources from what still needs confirmation, and shows how the pieces combine in a project's capital stack.

The guide is written for buyers and builders: procurement officers who need to know which documentation will be demanded by tax-credit buyers, EPC executives sequencing 2026–2027 construction starts, developers screening states, and tax counsel looking for a single dated reference. Every value cited carries its source and date. Items that the research desk could not confirm on a primary source are omitted, or marked "n/c" (not confirmed in primary sources as of October 2026) in tables, rather than presented as fact, and state opportunity tiers are a SolarStock USA Research assessment built on the transparent rubric set out in Section 3 and in the Methodology.

Conclusions

1. The federal calendar now drives project sequencing. Under the One Big Beautiful Bill Act (OBBBA, P.L. 119-21), a solar facility that began construction after July 4, 2026 earns §48E or §45Y credits only if it is placed in service by December 31, 2027. Facilities that began construction on or before July 4, 2026 keep the older phase-out timeline, which makes beginning-of-construction evidence the most valuable document in a 2026 project file.
2. The 5% safe harbor is available again, but its durability is not settled. On June 6, 2026 the U.S. District Court for the District of Columbia vacated Notice 2025-42 in Oregon Environmental Council v. IRS, restoring the 5%-cost safe harbor alongside the physical work test. No appeal had been filed as of the September 4, 2026 extension deadline, no later appeal has been publicly reported and Treasury has issued no replacement guidance.
3. FEOC compliance is a gating item for every 2026 construction start. Notice 2026-15 sets a 40% material assistance cost ratio (MACR) for solar facilities beginning construction in 2026. Supplier certifications and cost tables now sit on the critical path for tax-equity and credit-transfer closings, and the same cost data can support the domestic content adder, whose threshold is 50% for 2026 starts.
4. Credits remain monetizable and depreciation is still front-loaded. §6418 transferability survives OBBBA, with transfers to specified foreign entities barred. 100% bonus depreciation is permanently restored for property acquired after January 19, 2025, and on the statutory text solar that qualifies for §48E remains 5-year MACRS property under §168(e)(3)(B)(viii), even though OBBBA removed the separate energy-property reference.
5. USDA REAP grants are not a source of upfront capital for 2026–2027 builds. Grants have been paused since March 31, 2026, and the final rule published October 1, 2026 (effective October 16) requires twelve months of operating data before application. Guaranteed loans remain open.
6. Commercial demand is concentrated in a handful of states. California installed 39% of U.S. commercial solar in 2025, out of 2,345 MWdc nationally, with Illinois and New York following. In Q2 2026, California accounted for 256 MW of 638 MW commercial nationwide, and SEIA/Wood Mackenzie expect commercial volumes to decline an average of 7% across 2026–2027.
7. State performance incentives remain open and material. New Jersey's ADI pays $85–$110 per SREC-II for non-residential segments, Illinois Shines Large DG RECs range from $31.96 to $69.65, Massachusetts SMART 3.0 base rates run $0.179–$0.281/kWh with most of the 600 MW PY2026 block still unallocated, and DC SRECs were assessed near $358–$360/MWh in August 2026.
8. Three state cliffs land in 2026–2027. California's §73 property-tax exclusion applies only to systems completed before January 1, 2027; Maryland's retail net metering closes no later than July 1, 2027 under HB 1532; and North Carolina's H 1213 would end the 80% property-tax exclusion for systems placed in service on or after July 1, 2027 — a bill that cleared House Finance 12–8 in July 2026 but had not been confirmed as enacted as of mid-October.
9. Export compensation keeps eroding for larger systems. DSIRE's May 2026 map counts 28 states plus DC with net metering at investor-owned utilities and 16 with net billing or other compensation. Illinois moved new systems to supply-only crediting in 2025, Virginia approved Dominion's NEM 2.0, Connecticut enacted NRES successors in Public Act 26-127 and Maine is phasing out front-of-meter net energy billing.
10. Financing infrastructure is broad. PACENation data show C-PACE enabling legislation in 40 states plus DC and active programs in 36 plus DC; New Jersey's statewide program has operated since July 30, 2025. Arizona, Indiana, Iowa, Kansas, Louisiana, Mississippi, the Dakotas, South Carolina, West Virginia and Wyoming show no active program.

At a glance

Section 1The federal layer as of October 2026

The federal credit remains the largest single layer in most commercial and utility-scale capital stacks. What changed in 2025–2026 is not the existence of the credit but the window in which it can be earned, the evidence required to prove eligibility, and the supply-chain conditions attached to it.

Chart 01 · Federal timeline

Federal milestones shaping 2026–2027 solar projects

Key statutory, regulatory and judicial dates, July 2025 – December 2027

1.1 §48E ITC and §45Y PTC after OBBBA

OBBBA, signed July 4, 2025, kept the technology-neutral investment credit (§48E) and production credit (§45Y) but drew a hard line for wind and solar. Projects that began construction on or before July 4, 2026 keep the pre-OBBBA phase-out schedule. Projects that began construction after that date must be placed in service by December 31, 2027 to earn any credit. Law-firm analyses by Steptoe (June 9, 2026), Novogradac (June 16, 2026), Bracewell (July 15, 2025) and Clifford Chance (September 4, 2026) are consistent on this structure.

For a buyer of modules or an EPC planning 2027 completions, the practical consequence is binary. A project that can prove construction began by July 4, 2026 has time; a project that cannot must reach placed-in-service status within roughly fifteen months of this guide's date. Interconnection queues, transformer lead times and permitting therefore weigh more heavily on post-July-4 starts than any single state incentive.

The underlying credit-rate structure — a 6% base rate rising to 30% when prevailing wage and apprenticeship (PWA) requirements are met, with facilities of less than 1 MW AC exempt from PWA — is set by §48E(a)(2)(A) and was not changed by OBBBA. Two OBBBA changes are worth noting. First, for tax years beginning after July 4, 2025, no §48E credit is available for property attributable to qualified solar water heating or small wind expenditures for leased dwellings (Eide Bailly). Second, for tax years beginning after July 4, 2027 — 2028 for calendar-year taxpayers — payments to specified foreign entities within ten years after placed-in-service can trigger 100% recapture of §48E credits under §50(a)(4) (Novogradac; Bracewell). This sits alongside the general investment-credit recapture period in §50(a)(1): five full years from placed in service, with the recapture percentage stepping down from 100% in year one by 20 points a year.

1.2 Beginning of construction: Notice 2025-42 and its vacatur

Notice 2025-42, issued August 15, 2025, required wind and solar projects to establish beginning of construction through the physical work test. It eliminated the 5% safe harbor except for solar facilities of 1.5 MW AC or less, and kept the four-year continuity safe harbor (Novogradac; IRS notice text).

On June 6, 2026 the U.S. District Court for the District of Columbia, in Oregon Environmental Council v. IRS (No. 1:25-cv-04400), vacated the Notice in full and remanded it, finding it arbitrary and capricious under the Administrative Procedure Act. The practical effect, as summarized by Steptoe on June 9, 2026, is that solar projects can again rely on either the physical work test or the 5% safe harbor.

The government's 60-day appeal window expired August 5, 2026, and an extension under FRAP 4(a)(5) was available until September 4, 2026. Clifford Chance reported that no notice of appeal had been filed as of its September 4 briefing and advised developers to revisit beginning-of-construction strategy for projects started on or after September 2, 2025. The research desk found no public report of an appeal, stay or extension after that date, but did not review the court docket. Treasury has not issued replacement beginning-of-construction guidance: none appears in Internal Revenue Bulletins through IRB 2026-42 or in the Federal Register through October 14, 2026, and the IRS's draft 2026 Form 3468 instructions (September 15, 2026) describe the 5% safe harbor as an available method without a wind/solar limitation.

Notice 2025-42 never governed the separate beginning-of-construction determination under the FEOC material-assistance rules. For pre-2026 construction starts under those rules, both the physical work test and the 5% safe harbor remained available (Novogradac).

1.3 Bonus adders

Eide Bailly OBBB energy-credit alert; Baker Tilly, Notice 2026-39; IRS §48E(h) program page (July 27, 2026).

The domestic content step from 50% to 55% at the end of 2026 is a procurement deadline in its own right. A project that begins construction in 2026 is tested against the lower threshold; the same bill of materials for a 2027 start must clear a higher bar. For energy communities, the June 2026 list update matters most for projects sited in statistical areas whose unemployment data changed; siting teams should re-run eligibility against the current lists rather than relying on 2025 screens.

1.4 FEOC, prohibited foreign entities and the MACR

OBBBA introduced two families of foreign-entity restrictions. Taxpayer-level restrictions on specified foreign entities and foreign-influenced entities apply to tax years beginning after July 4, 2025. Material-assistance restrictions apply to §48E and §45Y facilities beginning construction after December 31, 2025 (Bracewell; Novogradac).

Notice 2026-15, reported February 13, 2026, provides interim guidance. It sets the material assistance cost ratio — the share of a facility's relevant costs that must come from non-prohibited sources — at 40% for qualified facilities such as solar beginning construction in 2026, 55% for energy storage, and 50% for §45X components sold in 2026. It offers three safe harbors: an identification safe harbor, a cost-percentage safe harbor based on IRS tables, and a supplier certification safe harbor. Domestic content tables may also be used. Qualified interconnection property is calculated separately, and MACR errors carry a six-year assessment window (pv magazine USA, February 13, 2026; Troutman, February 20, 2026).

Costs under binding written contracts signed before June 16, 2025 can be excluded from the MACR if the facility began construction before August 1, 2025 and is placed in service within the statutory deadline (Novogradac). MACR thresholds for construction starts after 2026 were not found in the sources read, and rules for determining prohibited-foreign-entity status were still pending as of June 2026.

1.5 Monetization: transferability and elective pay

OBBBA preserved §6418 credit transfers, except that transfers to specified foreign entities are prohibited (Eide Bailly, February 3, 2026; Holland & Knight; Buchanan Ingersoll). The mechanics are unchanged: a cash sale to an unrelated party, IRS pre-filing registration, an irrevocable election, no re-transfer, passive treatment of the credits in the buyer's hands, and a 20% excessive-credit penalty borne by the buyer absent reasonable cause. Market pricing for 2026 transfers was not found in the sources read, so this guide does not cite a discount.

§6417 elective pay remains the route for tax-exempt, governmental and tribal owners and for rural electric cooperatives. OBBBA did not change who may elect, but it added §6417(d)(6)(D), which applies the excessive-payment rule — including the 20% addition — to an elective-pay entity whose applicable energy credit is disallowed within the meaning of §6662(m)(2), for taxable years beginning after July 4, 2025.

1.6 Depreciation

100% bonus depreciation was permanently restored for qualified property acquired after January 19, 2025 (SEIA, page modified May 14, 2026; Bracewell). Rate-regulated public-utility property is excluded. Depreciable basis is reduced by 50% of the ITC claimed, so a project taking a 30% ITC depreciates 85% of its basis (SEIA).

OBBBA §70509 removed solar and wind energy property described by reference to §48(a)(3)(A) from the 5-year class in §168(e)(3)(B)(vi), for property beginning construction after December 31, 2024. It did not amend §168(e)(3)(B)(viii), which continues to list §48E qualified property that is part of a qualified investment and §45Y qualified facilities as 5-year property, and IRS Publication 946 (2025) states both rules. On the statutory text, solar property that qualifies for the §48E credit therefore remains 5-year MACRS property. Solar that does not qualify under §48E or §45Y — for example, a post-July 4, 2026 start placed in service after 2027 — would fall back to its general class life; that reading is the research desk's inference from the statutory structure, and owners should confirm treatment with tax counsel.

1.7 USDA REAP

The Rural Energy for America Program has historically been a meaningful source of grant funding for small agricultural and rural-business solar. For 2026–2027 starts, it is not. USDA paused grants on March 31, 2026, and a Federal Register notice of April 15, 2026 rescinded the October 16, 2024 notice of funding opportunity; there is no FY2026 grant NOFO (USDA REAP FAQ; OpenGrants). Guaranteed loans remain open, covering up to 75% of project cost with an 80% guarantee.

A final rule amending 7 CFR 4280 (RIN 0570-AB13) was published in the Federal Register on October 1, 2026 (91 FR 62600; FR Doc. 2026-20178) and is effective October 16, 2026. As described in the public-inspection filing, the rule makes ground-mounted solar and wind on certified cropland ineligible; bars components from foreign-adversary countries; requires projects to be complete and operating, with twelve months of production or savings data, before applying; requires systems sized to historical use, caps storage at 120% of average use and requires simple payback no longer than useful life; and allows one application per fiscal year, with the top two applications per state funded first.

SolarStock USA Research assessment: under these terms, REAP functions as a post-construction reimbursement for small on-site systems rather than as upfront capital. Criteria: the twelve-month operating-data prerequisite and the absence of a FY2026 grant NOFO.

1.8 Federal timeline, January–October 2026

IRS, USDA, Federal Register and law-firm sources cited above.

Section 2How the incentives stack

No single incentive makes or breaks a commercial project; the combination does. The order in which layers are applied matters, because several of them interact — most importantly through the ITC's reduction of depreciable basis and through the tax characterization of state payments.

Chart 02 · Capital stack

The eight layers of a commercial solar incentive stack

Typical application order, from the federal credit to project financing

2.1 Stacking order

The federal credit is applied first: the §48E ITC or §45Y PTC base rate, plus any domestic content, energy community or §48E(h) adder. The credit is then monetized through tax equity, a §6418 transfer, or §6417 elective pay for eligible tax-exempt owners. Depreciation follows on a basis reduced by half of the ITC. State performance payments — SREC or REC sales, per-kWh tariffs or per-watt incentives — and bill savings or export compensation make up the operating revenue line. State tax relief (sales and use tax exemptions on equipment; property tax exemptions, abatements or PILOT agreements) lowers capital and operating costs. Utility rebates and financing tools such as C-PACE or green-bank capital close the stack.

2.2 Interaction rules to confirm with counsel

• Grants and rebates may affect ITC basis depending on how they are characterized for tax purposes; the treatment of each grant, rebate and REC sale should be confirmed with tax counsel.
• Some programs take the RECs. Xcel Energy's Solar*Rewards program in Colorado takes ownership of the RECs, so the same attributes cannot be sold elsewhere.
• Programs can be mutually exclusive. Delaware's SEU SREC Purchase Program, for example, excludes systems that hold other long-term SREC contracts.
• MACR and domestic content share data. Because the domestic content tables can support MACR attribution, one well-built procurement file can serve both tests.

2.3 Worked example — Illustrative

A taxable C-corporation owns a hypothetical rooftop system in New Jersey sized to fall within the ADI non-residential rooftop segment under 1 MW. Construction is assumed to have begun in 2026 before July 4.

SolarStock USA Research, Illustrative calculation. ADI value: NJ BPU order (May 21, 2026). Basis-reduction rule: SEIA. All other inputs hypothetical.

Chart 03 · Illustrative

Illustrative stack for a hypothetical 900 kWdc New Jersey rooftop

Federal credit, depreciation tax value and first-year ADI revenue under two adder scenarios

Three observations follow from the arithmetic. First, the two adders together add $324,000 of credit but reduce the depreciation tax value by $34,020, because each additional ITC dollar removes fifty cents of depreciable basis. Second, the ADI revenue line recurs annually over the 15-year SREC-II qualification life set by the BPU; its present value depends on production over that term and on the discount rate, neither of which is modelled here. Third, the constraints that decide whether the numbers are available at all sit outside the table: the 40% MACR for 2026 starts, the December 31, 2027 placed-in-service deadline for any start after July 4, 2026, and any discount on a §6418 transfer.

Section 3National overview

Installation volume, policy prevalence and tax treatment point in different directions. The states with the most commercial capacity are not always the states with the richest incentives, and the national counts published by SEIA, DSIRE and PACENation cover different jurisdictions and dates.

3.1 Where commercial solar is being built

SEIA and Wood Mackenzie's 2025 Year in Review put U.S. commercial installations at 2,345 MWdc, up 6%, within a total market of 43.2 GW (down 14%) dominated by 34.7 GW of utility-scale capacity. California alone accounted for 39% of commercial installations, up 28% year on year. California, Illinois and New York led, with Massachusetts, Pennsylvania and Texas also strong. Community solar fell 25% to 1,435 MWdc.

Chart 04 · Commercial installs

California's share of U.S. commercial solar

Commercial installations, California versus the rest of the U.S., 2025 and Q2 2026 (MWdc)

The Q2 2026 data, released in September, show 638 MW of commercial installations nationally (+11% year on year), of which California contributed 256 MW, largely from its NEM 2.0 pipeline. Illinois, New York, Texas and Ohio together contributed more than 150 MW. SEIA and Wood Mackenzie expect commercial volumes to decline an average of 7% per year across 2026–2027.

Chart 05 · Community solar

Community solar installations by state, 2025

MWdc installed; the four states named by SEIA/Wood Mackenzie and the remainder

Chart 06 · Utility-scale leaders

Volume leaders across all segments and in utility-scale

2025 total installations (approximate) and Q2 2026 utility-scale installations, GW

3.2 How common are the main policy tools?

DSIRE's summary maps for April–May 2026 show PV financial incentives in 45 states plus DC, IOU net metering in 28 states plus DC, community solar policy in 24 states plus DC and third-party PPAs allowed in at least 29 states plus DC. PACENation's March 2026 data show C-PACE legislation in 40 states plus DC and active programs in 36 plus DC. SEIA's most recent published counts — 36 states with property tax exemptions and 25 with sales tax exemptions — date from May 2025 and do not name the states.

Chart 07 · Policy prevalence

Prevalence of state-level policy tools

Number of states (and DC where counted) with each tool, latest available national dataset

Chart 08 · Net metering & C-PACE

Export compensation and C-PACE status across 51 jurisdictions

DSIRE IOU compensation categories (May 2026) and PACENation C-PACE status (Mar 2026)

3.3 How much of the state tax picture is verified?

State tax treatment of commercial solar is where the public record is weakest. Several widely used comparison tables are undated or draw on 2024 data, and many state statutes distinguish residential from commercial use in ways those tables do not capture. Chart 09 shows how many jurisdictions' commercial sales and property tax treatment this edition could verify on a primary or dated source.

Chart 09 · Verification status

Verification status of state tax treatment in this guide

Commercial sales tax and property tax treatment across 51 jurisdictions, by verification status

3.4 Opportunity tiers

Each jurisdiction carries a tier badge. The tiers are a SolarStock USA Research assessment, not an official rating, and are built from four criteria scored 0–2 on the October 2026 status found:

Tier 1 = 6–8 points; Tier 2 = 4–5; Tier 3 = 0–3. Where inputs are unverified, the tier is marked provisional. Tiers describe the incentive and market environment for commercial solar; they say nothing about the merits of any individual project.

Chart 14 · Tier distribution

Opportunity tiers by region

Number of jurisdictions per tier — SolarStock USA Research assessment

Section 4Northeast & Mid-Atlantic

The Northeast and Mid-Atlantic hold the deepest set of state performance incentives in the country: New Jersey's ADI, Massachusetts' SMART 3.0, the DC and Maryland SREC markets and New York's NY-Sun per-watt incentives. It is also the region where several retail net metering regimes are being replaced.

Three dynamics define the region in late 2026. First, incentive levels in New Jersey were held steady for non-residential segments in the May 2026 Triennial Review, and the EY2027 net-metered non-residential block grew to 150 MW. Second, Massachusetts' SMART 3.0 has capacity available — only 8.3% of the 600 MW PY2026 block had been qualified as of September 10, 2026 — while the PY2027 draft shows rates moving in both directions by size class. Third, the solar alternative compliance payments that cap SREC prices are stepping down in DC and Maryland, and the DC market faces oversupply.

Chart 12 · New Jersey ADI

New Jersey ADI SREC-II values by non-residential segment

US$ per SREC-II, Energy Year 2027 (unchanged from prior values for non-residential)

Chart 11 · Massachusetts SMART 3.0

SMART 3.0 base compensation rates by capacity

PY2026 final and PY2027 draft base rates, US$/kWh over a 20-year term

Chart 13 · SACP schedules

Solar alternative compliance payment schedules

US$ per MWh by compliance year; SACP sets the effective ceiling for SREC prices

Regional snapshot

Sections 4–8 state profiles; DSIRE IOU net metering map (May 2026). Tiers: SolarStock USA Research assessment.

State profiles

Section 5Southeast

The Southeast combines large utility-scale volume with thin state incentive programs. Commercial economics rest on federal credits, property tax treatment and, increasingly, utility-run subscription products rather than state performance payments.

Florida stands out for verified tax relief: a sales tax exemption with no sunset and an 80% exemption on renewable energy devices treated as tangible personal property through 2037. Virginia exempts business-owned solar equipment from sales tax and applies a property tax stepdown under §58.1-3660 that gives utility-scale projects a predictable schedule; the SCC also approved Dominion's NEM 2.0, which kept monthly netting. North Carolina, South Carolina, Kentucky, Arkansas and West Virginia have no solar-specific sales tax exemption, but plants generating electricity for sale can exempt equipment under manufacturing or electric-power provisions. North Carolina's 80% property tax exclusion is the region's main policy risk: H 1213, which would end it for systems placed in service on or after July 1, 2027, cleared House Finance 12–8 but had not been confirmed as enacted. In Georgia, the main path for C&I buyers is Georgia Power's CARES CIR subscription program, whose distributed-generation window is expected to open in Q4 2026.

Tennessee exempts generation equipment at TDEC-certified green energy production facilities, while Louisiana's property tax exemption is residential-only. Tennessee is also the only state that DSIRE's May 2026 map classifies as offering no DG compensation, and South Carolina, Mississippi, Louisiana and West Virginia show no active C-PACE program.

Regional snapshot

Sections 4–8 state profiles; DSIRE IOU net metering map (May 2026). Tiers: SolarStock USA Research assessment.

State profiles

Section 6Midwest

Illinois anchors the Midwest with the region's only large, actively priced REC program for commercial solar. Elsewhere, the region's activity is driven by utility-scale volume — Indiana was third nationally in 2025 and Michigan third in Q2 2026 utility-scale — rather than by state incentives.

Illinois Shines opened PY2026-27 on June 1, 2026 with Large DG REC prices from $31.96 to $69.65 depending on size and group, alongside $300/kW utility DG rebates at ComEd and Ameren. Illinois also moved new systems to supply-only crediting from January 1, 2025, which shifts more value onto the REC contract. HB 5444, which would roughly double the statutory per-MW property tax basis from 2027, stalled in House Rules in March 2026. Minnesota offers a sales tax exemption with no sunset, exempts solar personal property and levies a $1.20/MWh production tax above 1 MW, and runs a community solar garden program whose annual cap steps down from 100 MW to 80 MW in 2027. Ohio was among the leading commercial states in Q2 2026; it has no state SREC market (its RPS solar carve-out has been 0% since 2020) but offers a sales tax exemption for generation for others and a $7,000/MW Qualified Energy Project PILOT. Michigan's PA 108 replaces property tax with a $7,000/MW specific tax for 20 years on facilities of 2 MW AC or more, and Treasury confirmed in April 2026 that solar equipment selling its power qualifies for the industrial-processing sales tax exemption. Several Plains states use in-lieu generation taxes instead of property tax — Nebraska ($3,518/MW), South Dakota ($3/kW plus a production charge above 5 MW) and North Dakota — while Missouri's statutory solar property exemption was struck down in 2022.

Chart 10 · Illinois Shines

Illinois Shines Large DG REC prices, PY2026-27

US$ per REC by system size and group

Regional snapshot

Sections 4–8 state profiles; DSIRE IOU net metering map (May 2026). Tiers: SolarStock USA Research assessment.

State profiles

Section 7Southwest & Mountain

The Southwest and Mountain region is the country's utility-scale engine. Texas led the nation with about 11 GW in 2025, and Arizona ranked second in H1 2026. State incentives for commercial solar are modest; tax treatment and market access do most of the work.

Texas offers a property tax exemption under Tax Code §11.27 for solar devices primarily for on-site use, while utility-scale projects rely on Chapter 312 abatements; SB 1754, which would have barred those abatements for wholesale solar, died in 2025, and the issue may return when the legislature meets in 2027. There is no statewide net metering rule; in ERCOT, export compensation is at the retail electric provider's discretion. Arizona's transaction privilege tax deduction for solar devices now survives only for retail sales — the prime-contracting deduction expired at the end of 2016 — and generation equipment for sale is valued at 20% of depreciated cost through 2040; the state has no C-PACE program. Colorado exempts renewable generation components from state sales and use tax, and Xcel Energy's Solar*Rewards pays C&I systems of 8 kW–1 MW AC a 20-year production incentive. New Mexico's gross receipts tax deduction applies only to on-site systems. Utah's sales tax exemption for facilities of 2 MW or more ends June 30, 2027; Nevada offers GOED sales and property tax abatements for wholesale facilities of 10 MW or more; and Idaho replaces property tax with a 3.5% tax on gross solar earnings.

Regional snapshot

Sections 4–8 state profiles; DSIRE IOU net metering map (May 2026). Tiers: SolarStock USA Research assessment.

State profiles

Section 8West & Pacific

California is the largest commercial solar market in the country and, in 2026, the one facing the sharpest state-level deadline: the §73 property tax exclusion for new construction applies only to systems completed before January 1, 2027.

California's Net Billing Tariff, upheld on remand by the First District Court of Appeal in March 2026, has reduced export credits by roughly 75–80% compared with NEM 2.0, and commercial volume in 2026 is being sustained by the NEM 2.0 pipeline. AB 2389, which would have extended the §73 exclusion, was held in committee on May 14, 2026, and as of October 8, 2026 no replacement had been reported. California also offers a 3.9375% partial sales tax exemption for businesses primarily engaged in power generation, through June 30, 2030. Washington's sales tax exemption is size-tiered — full for systems up to 100 kW AC, 50% for 100–500 kW AC — and expires at the end of 2029, while facilities of 10 MW AC or more can swap the state property levy for a per-MW excise tax. Oregon's state rebate is closed to commercial projects; its on-site property tax exemption runs to 2029, and the county fee-in-lieu option for utility-scale projects closes to new agreements on January 2, 2028. Hawaii capped and will sunset its renewable energy income tax credit under Act 24 (2026), and Alaska's local property exemption option covers residential systems only.

Regional snapshot

Sections 4–8 state profiles; DSIRE IOU net metering map (May 2026). Tiers: SolarStock USA Research assessment.

State profiles

Section 951-jurisdiction summary table

The table condenses the state profiles. Sales and property tax columns refer to commercial applicability where known. "REC/SREC" lists state SREC or REC markets, state-administered REC procurements and per-kWh or per-watt state or utility performance programs. Net metering categories follow DSIRE's May 2026 IOU map; C-PACE status follows PACENation (March 2026), with New Jersey treated as active per NJEDA. Tier is the SolarStock USA Research assessment; "p" marks a provisional tier. n/c = not confirmed in primary sources as of October 2026.

SolarStock USA Research compilation from the sources listed in each state profile; DSIRE (May 2026); PACENation (Mar 6, 2026). n/c = not confirmed in primary sources as of October 2026.

Section 10Deadlines calendar 2026–2027

The following dates are drawn from verified sources unless flagged. Pending legislation is shown with its status as verified; it is not law until enacted.

Chart 15 · Deadlines

State and federal deadlines, October 2026 – early 2028

Dated milestones affecting commercial and utility-scale project timing

As listed in the chart caption; state profiles in Sections 4–8.

ReferenceMethodology, Sources & Disclosures

Methodology

This guide was compiled by the SolarStock USA Research Desk from research conducted through October 14, 2026. Each fact was classified as verified — read on a primary source (statute, agency, court, IRS/Treasury, utility or program administrator) or on a named law-firm or trade publication citing the primary action, with a date — or unverified, meaning it rests only on a secondary aggregator, sources conflicted, or it is background knowledge not re-checked. Only verified items are stated as fact in this guide; unverified items are omitted or, in tables, marked n/c (not confirmed in primary sources as of October 2026). Where a value was searched for and not found, the guide says so rather than estimating.

Depth of coverage varied by state. The fifteen priority states (CA, TX, NJ, NY, MA, IL, MD, NC, FL, AZ, CO, MN, PA, VA, GA) and DC, CT, DE, OH, MI, ME, RI, WA, OR and NM were researched individually. The remaining states initially rested mainly on national datasets — DSIRE summary maps (April–May 2026), PACENation map data (page modified March 6, 2026) — and on two secondary comparison tables (one undated, one with data as of September 2024). Subsequent verification passes replaced most of those secondary items with statute or agency citations; where a line could not be confirmed it is omitted or marked n/c, and tiers that depend on unconfirmed inputs remain labelled provisional.

DSIRE per-state categories were read visually from the published summary map images; totals were verified. For states near a category boundary (NH, VT, OR, ID, NV, TX, NY), readers should confirm the classification against DSIRE program records.

Opportunity tiers

Tiers are a SolarStock USA Research assessment built on four criteria scored 0–2 — (A) state performance incentive open to C&I; (B) commercial export compensation; (C) sales and property tax relief for commercial projects; (D) market activity per SEIA/Wood Mackenzie — with Tier 1 at 6–8 points, Tier 2 at 4–5 and Tier 3 at 0–3. Tiers that depend on unverified inputs are labelled provisional. Tier badges in the profiles use green (Tier 1), blue (Tier 2), amber (Tier 3) and grey (provisional Tier 2 or 3). Tiers are editorial, not an official rating, and are not a recommendation regarding any project, jurisdiction or investment.

Sources

Primary regulatory

• Public Law 119-21 (One Big Beautiful Bill Act), signed July 4, 2025.
• IRS Notice 2025-42 (Aug 15, 2025); IRS Notice 2026-15 (Feb 2026); IRS Notice 2026-39 (June 10, 2026).
• IRS, §48E(h) Low-Income Communities Bonus Credit program page, irs.gov/node/125331 (updated July 27, 2026); DOE program summary (2024).
• IRS Publication 946 (2025), How to Depreciate Property; 26 U.S.C. §§48E(a)(2), 50(a), 168(e)(3)(B), 6417(d)(6)(D), 6662(m) (Cornell LII).
• IRS Internal Revenue Bulletins 2026-37 to 2026-42; IRS draft 2026 Form 3468 and Instructions (Sept 15, 2026).
• USDA Rural Development, REAP FAQ (Mar 31, 2026); Federal Register 91 FR 62600 (Oct 1, 2026), FR Doc. 2026-20178.
• NJ BPU, ADI Triennial Review order (May 21, 2026); NJ BPU, CSI Solicitation 3 awards order (Mar 4, 2026).
• NY Department of Taxation and Finance, TSB-A-20(46)S, TSB-M-15(5)S, RP-487 instructions; NYSERDA NY-Sun operating plan webinar (July 29, 2025).
• Massachusetts DOER, SMART 3.0 overview and PY27 draft annual report (Oct 2026); MA DLS, Clause 45 guidance (Jan 8, 2026).
• Maryland General Assembly: Tax-General §§11-207, 11-230; Tax-Property §§7-237, 7-242, 8-240; SB 669 and HB 990 (2026RS) legislation pages and fiscal note.
• Connecticut OLR report 2023-R-0214; Public Act 26-127 (HB 5340, 2026); CT DRS Special Notices SN 2007(7) and SN 2010(9.1).
• New Jersey: N.J.S.A. 54:32B-8.33 (via S1000, 2024); N.J.A.C. 18:24-26; Division of Taxation Form CRES.
• Rhode Island Gen. Laws §§44-18-30, 44-3-3, 44-5-3, 44-3-21; Maine 36 M.R.S. §1760 and MRS Property Tax Bulletin No. 29 (Dec 30, 2024); Vermont 32 V.S.A. §§9741, 3802, 3845 and 30 V.S.A. §8002; NH RSA 72:62; D.C. Code §§47-2005, 47-1508; 52 Pa. Code §75.13.
• Virginia Code §58.1-609.3 and Tax Commissioner ruling P.D. 18-112; NCDOR MEPLR 2010-0002 and SUPLR 2021-0016; SCDOR PLR 15-1 and S.C. Code Title 12 Ch. 37; KDOR KY-TAM-21-01; Tenn. Code §67-6-346 (TDEC/TDOR guidance); W. Va. Code §11-15-9; La. R.S. 47:1706; Fla. Admin. Code R. 25-6.065; GA DOR LR SUT-2020-04; ADOR 9B abatement form (2026).
• Rhode Island PUC Docket 25-52-REG prefiled testimony (Jan 2026); Maine Legislature LD 1777 summary.
• Code of Virginia §58.1-3660; NCGA fiscal note HFN1213v2 (June 30, 2026); UNC School of Government bill summary H 1213.
• Florida Statutes §196.182; UCF Florida Solar Energy Center energy policy page (Oct 14, 2025).
• Illinois Shines, Final 2026-27 REC prices and block capacity update (May–June 2026); Illinois General Assembly HB 5444 (104th GA).
• Minnesota LBO TERC solar energy systems summary (Oct 24, 2025); Minnesota Commerce community solar garden page.
• Texas Tax Code §11.27; Texas Legislature SB 1754 bill analysis (89R).
• Arizona Senate brief, Tax Incentives for Renewable Energy (2018); Arizona Commerce Authority solar sheet.
• C.R.S. 39-26-724; Colorado Division of Property Taxation renewable energy page.
• California BOE LTA 2024/031; BOE SB 710 analysis; CalMatters Digital Democracy, AB 2389.
• RCW 82.08.962 (RCW archive, 2023); Oregon Department of Energy, Solar + Storage Rebate page (2026).
• Southern Company / Georgia Power media release (June 25, 2026).
• Midwest: Ohio R.C. §§5739.02, 5727.75, 4928.64; Michigan Treasury RAB 2026-6 and MCL 211.1151 et seq.; Wis. Stat. §§77.54(56), 70.111(18), 79.04(6); Indiana DLGF memos (2022, 2025); ILGA HB 5444 bill status; Iowa Code §§423.3, 441.21, 422.11L; RSMo §§144.030, 137.100; Minn. Stat. §§272.02, 272.0295; N.D.C.C. chs. 57-02, 57-33.2, 57-39.2; SDCL 10-4-44, 10-35-17 to -19.1; Neb. Rev. Stat. §§77-202, 77-6203 and Reg-1-107; K.S.A. 79-201, 79-3606.
• Southwest, Mountain and West: Tex. Tax Code §151.318 and TLO SB 1754 history; A.R.S. §§42-5061, 42-5075, 42-14155 and ADOR code 538 notice; NM TRD 2025 Tax Expenditure Report; Utah Code §§59-12-102, 59-12-104; NRS ch. 701A; Oklahoma SB 237 (2026); I.C. 63-3502B, 63-602JJ; MCA 15-6-224; Wyoming Title 39 (2026); CDTFA Regulation 1525.4; WA DOR renewable generation excise tax (RCW 84.36.680, ch. 82.96); ORS ch. 307; Honolulu RPAD; Hawaii Act 24 (2026) and HI C-PACER; AS 29.45.050.

Market data

• SEIA/Wood Mackenzie, US Solar Market Insight 2025 Year in Review (Mar 2026), via seia.org and pv magazine USA (Mar 11, 2026).
• SEIA/Wood Mackenzie, Q3 2026 US Solar Market Insight, as reported by Mercom (Sept 11, 2026).
• DSIRE / NC Clean Energy Technology Center, detailed summary maps (Apr–May 2026).
• NC Clean Energy Technology Center, 50 States of Solar Q2 2026 executive summary (July 2026).
• PACENation, PACE programs map data (page modified Mar 6, 2026).
• SEIA, solar tax exemption counts (page modified May 9, 2025); SEIA depreciation page (modified May 14, 2026).
• S&P Global Commodity Insights, DC SREC market interview (Aug 10, 2026); Flett Exchange market specifications (DC, MD, MD-Certified).

Legal & tax analysis

• Steptoe, district court vacates IRS notice (June 9, 2026).
• Novogradac, compliance timeline for §§48E, 45Y, 45X (June 16, 2026); Novogradac court-rulings resource center.
• Clifford Chance, IRS Notice 2025-42 appeal deadline nears (Sept 4, 2026).
• Bracewell, big tax changes in the One Big Beautiful Bill Act (July 15, 2025).
• Eide Bailly, OBBB energy credits alert (2025) and transferability commentary (Feb 3, 2026).
• Holland & Knight (July 2026); Buchanan Ingersoll & Rooney; Troutman Pepper (Feb 20, 2026); Baker Tilly, Notice 2026-39.
• Whiteford, Virginia rooftop solar client alert (2026); Bricker & Eckler (2012); Greenbaum Rowe (NJ ADI); Davis Wright Tremaine (June 2010); Butler Snow (Nov 2022); Frost Brown Todd (Apr 2020); Aprio (Aug 2019); go-alliant (Aug 13, 2026); Haynes Boone (Sept 26, 2019); Stoel Rives (Feb 8, 2024); Frost Brown Todd (Indiana); Ezel (IL GIL summary).

Industry and secondary

• pv magazine USA: FEOC interim guidance (Feb 13, 2026); Dominion NEM 2.0 (May 4, 2026); NC H 1213 (July 2, 2026); Texas anti-solar bills (May 28, 2025); pv magazine, California net billing ruling (Mar 11, 2026).
• Solar Power World, Massachusetts SMART changes (June 2026); Rutgers Policy Lab, Garden State C-PACE (Aug 2026); MyChesCo (Aug 27, 2026).
• EnergySage state pages (MD; IL Sept 9, 2026; TX Sept 4, 2026; CA Oct 8, 2026); NuWatt state guides (NJ, PA, CT; 2026); SurgePV (June 30, 2026); solarips.com (Oct 12, 2026); Citizens Utility Board (2025); Michigan Chamber (June 2023); OpenEI (2015); New Project Media.
• SolarReviews state exemption table (undated) and Palmetto property tax table (data as of Sept 2024) — used for initial screening only; no item resting solely on these tables is stated as fact.

Limitations & assumptions

• Program values, capacity blocks and statuses are as of the dates cited and can be exhausted, revised or repealed without notice.
• The research budget did not allow every state to be checked against primary sources; a minority of jurisdictions still rely partly on secondary or unconfirmed sources for tax treatment (Chart 09).
• Several official pages could not be retrieved during research (NJ ADI program page, NYSERDA NY-Sun dashboard, a DSIRE program record, and one North Carolina news article); related items are omitted or marked n/c. Verification passes on October 14, 2026 checked the federal items and the tax lines for all 51 jurisdictions against statutes, revenue-department rulings and dated law-firm analysis; items that could not be confirmed are omitted or marked n/c.
• Net metering classifications refer to investor-owned utilities; municipal utilities and cooperatives often differ.
• The worked example in Section 2 is Illustrative and uses hypothetical cost and production inputs; it is not a forecast.
• Residential programs are covered only where they shape commercial economics.

About SolarStock USA Research

SolarStock USA Research is the analytical desk of SolarStock USA, the first live-inventory solar module platform in the United States, operated by Yulz Design LLC. SolarStock USA holds Tier 1 manufacturers' module inventory in U.S. warehouses in California, Georgia, New Jersey and Texas, with brands including Sunpro Power, JA Solar, Mission Solar, Waaree and ZN Shine. Research outputs reflect the desk's independent analytical view; they are not investment advice and do not constitute a solicitation.

About the Authors

Yuliani Llohis is the Founder and Chief Executive Officer of SolarStock USA. Previously, she built and led Zytech Solar USA — the US subsidiary of Spanish PV manufacturer Zytech Solar Group — for fifteen years, with full P&L responsibility for the American market across residential, commercial, and utility-scale segments. The SolarStock USA Research Desk synthesizes primary regulatory sources, third-party market data and manufacturer documentation into published research.

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Republication

Short excerpts may be quoted with attribution to "SolarStock USA Research, State-by-State Solar Rebates & Incentives Guide, Q4 2026 Edition". Charts and tables may not be republished in full without prior written permission. Third-party data reproduced here remain subject to their publishers' terms.