Federal solar credit ended Dec 31, 2025
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Incentives · Arizona

Arizona Solar Incentives, Rebates and Tax Breaks

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Updated Data verified Nov 5, 2026

Arizona homeowners who buy solar in 2026 can still use 4 state, utility or local programs listed below. The federal Federal Residential Clean Energy Credit (25D)[1] is gone for systems installed after 2025, so state and utility programs now carry more of the savings. Each card shows the value, the deadline and the official source we checked.

On this page [ 6 ]

Federal incentives

Federal · tax creditClosed

Federal Residential Clean Energy Credit (25D)

30% for systems installed 2022–2025; not available for installations completed after December 31, 2025[1]

The 30% federal credit for homeowners who bought solar ended with Public Law 119-21. A system counts in the year its installation is completed, so paying in 2025 for a 2026 installation does not qualify.

Who
Homeowners who bought and installed a system by December 31, 2025 claim it on IRS Form 5695 for that tax year.
Deadline
December 31, 2025
Checked
November 5, 2026
Federal · tax creditEnding soon

Business credit for leased and PPA systems (48E)

Claimed by the system owner, not the homeowner; solar must begin construction by July 4, 2026 or be in service by December 31, 2027[2]

If a company owns the panels on your roof (a lease or power purchase agreement), that company may claim the business clean electricity investment credit and can reflect it in your price. You cannot claim it yourself.

Who
Third-party-owned systems (leases and PPAs). Ask the provider whether the price assumes this credit.
Deadline
December 31, 2027
Checked
November 5, 2026

State incentives in Arizona

State · tax creditAvailable

Arizona Residential Solar Energy Devices Tax Credit (A.R.S. 43-1083)

25% of the cost of the device, up to $1,000 (lifetime cap per residence); unused credit carries forward up to 5 years[3]

Subsection B: 'The maximum credit in a taxable year may not exceed one thousand dollars' and credits may not cumulate over different tax years beyond $1,000 for the same residence. Subsection C: carryforward 'for not more than five consecutive taxable years'. Subsection F: device and installation must meet A.R.S. title 44, ch. 11, art. 11 (warranty/installer standards). Nonrefundable (carryforward only). Claim form (ADOR Form 310) not verified because azdor.gov returned 403.

Who
An Arizona resident who is not a dependent of another taxpayer and installs a solar energy device in their Arizona residence. Credits for the same residence cannot exceed $1,000 in total across tax years.
Maximum
$1,000
Deadline
No sunset date in the statute text
Checked
November 5, 2026
State · tax exemptionAvailable

Arizona TPT (sales tax) deduction and use-tax exemption for solar energy devices

Sales of solar energy devices by a registered solar energy retailer are deducted from the state transaction privilege tax base; purchases from a registered solar retailer or contractor are exempt from use tax[4]

Use tax: A.R.S. 42-5159(E) (https://www.azleg.gov/ars/42/05159.htm): tax 'does not apply to the purchase of solar energy devices from a retailer that is registered with the department as a solar energy retailer or a solar energy contractor.' The separate prime-contracting deduction for solar installation contracts (A.R.S. 42-5075(B)(13)) applied only to taxable periods ending before January 1, 2017, so how a turnkey installation contract is taxed today was not verified. City (municipal) TPT…

Who
Applies to solar energy devices sold by a retailer registered with the Arizona Department of Revenue as a solar energy retailer. Buyers should confirm their seller/installer is registered.
Deadline
No sunset in A.R.S. 42-5061(M) or 42-5159(E)
Checked
November 5, 2026
State · tax exemptionAvailable

Arizona property tax exclusion for residential solar (A.R.S. 42-11054)

Solar energy devices and grid-tied PV systems primarily for on-site use are considered to add no value to the property for property tax assessment[5]

Subsection C(2). percent=100 means 100% of the system's added value is excluded from assessed value. For personal-property solar (C(3)), A.R.S. 42-13056 values it at depreciated original cost with assessor percentages of 3% in years 1-3 rising to 100% in year 10 (https://www.azleg.gov/ars/42/13056.htm).

Who
Owner-installed solar energy devices and grid-tied PV systems designed primarily for on-site consumption. Systems characterized as personal property (e.g., third-party-owned) are valued under A.R.S. 42-13056 instead.
Deadline
No sunset in statute text
Checked
November 5, 2026

Local incentives in Arizona

Local · rebateAvailable

City of Flagstaff Home Weatherization & Energy Rebate Program - Electric Service Upgrade

Electrical panel upgrade rebate up to $2,200 (25%, 15% or 5% of cost depending on household income level) when an upgrade to 200-amp service is needed to support PV solar or an electric appliance[6]

Table 2 lists 'Electrical Panel Up to $2,200'. Appliance/Electrical rebate is 25% (Level 1), 15% (Level 2) or 5% (Level 3) of total cost; percent field shows the maximum tier. This is not a rebate for the solar panels themselves.

Who
City of Flagstaff residents in existing homes whose service is below 200 amps and who upgrade to support an eligible electric appliance or PV solar installation; work by a licensed contractor with an electrical permit. Rebate percentage depends on household size and income (Level 1/2/3).
Maximum
$2,200
Deadline
June 30, 2027
Checked
November 5, 2026

Only for Arizona Public Service customers.

How these incentives stack

Cash rebates are paid first and usually reduce the cost a tax credit is based on. State tax credits only help if you owe enough state income tax. Exemptions (sales and property tax) apply automatically or through a form, and they do not reduce what you owe the installer on paper, so check that a quote does not charge tax that the law exempts. The calculator applies the programs it can model and lets you switch utility rebates on or off.

FAQ

Frequently asked questions

Does Arizona have a solar tax credit?

Yes: Arizona Residential Solar Energy Devices Tax Credit (A.R.S. 43-1083)[3] (25% of the cost of the device, up to $1,000 (lifetime cap per residence); unused credit carries forward up to 5 years[3]).

Can I still get the federal solar tax credit?

No, not if you buy the system and installation is completed after December 31, 2025 (Federal Residential Clean Energy Credit (25D)[1]). If a company leases you the panels or sells you the power, that company may still claim a business credit and may pass some value on through the price.

sources

[ 6 ]

Every number on this page links to one of these sources. Dates show when we last checked each one.

  1. IRS FS-2025-05: FAQs for modification of sections 25C, 25D, 25E, 30C, 30D, 45L, 45W, and 179D under Public Law 119-21 (OBBB)irs.gov · checked Nov 5, 2026
  2. Public Law 119-21 - Sec. 70513(a) and (g)(5) (48E); Sec. 70512(a) and (l)(4) (45Y)govinfo.gov · checked Nov 5, 2026
  3. A.R.S. 43-1083 - Credit for solar energy devicesazleg.gov · checked Nov 5, 2026
  4. A.R.S. 42-5061(M) - Retail classification deductionsazleg.gov · checked Nov 5, 2026
  5. A.R.S. 42-11054 - Standard appraisal methods and techniquesazleg.gov · checked Nov 5, 2026
  6. City of Flagstaff Home Weatherization & Energy Rebate Program Technical Contractor Guide, July 1, 2026 - June 30, 2027flagstaff.az.gov · checked Nov 5, 2026

Incentive list last re-checked November 5, 2026. Programs change; confirm with the program before you sign.