What this line means
The credit rate applied to your total qualified clean energy costs from line 5. For property placed in service in 2025, the rate is 30%. This rate applies to solar electric, solar water heating, small wind, geothermal, and battery storage installations. The 30% rate is locked through 2032 by the Inflation Reduction Act. Unlike the Part II credit, there is no annual dollar cap — 30% of whatever you spend is the credit. 1
Does this apply to you?
Easy to overlook
The 30% rate is guaranteed through 2032 Congress locked the credit rate at 30% for property placed in service from 2022 through 2032. You do not need to rush an installation to beat a deadline anytime soon. After 2032, the rate drops to 26% in 2033 and 22% in 2034. The credit expires entirely after 2034 unless Congress extends it. 2 Inflation Reduction Act Section 13302 — Residential clean energy credit extension
No dollar cap on the Part I credit The 30% rate applies to the full cost with no maximum. A $100,000 geothermal installation generates a $30,000 credit. This is different from Part II (Energy Efficient Home Improvement Credit), which caps at $3,200 per year. 1 IRS Form 5695 instructions — Line 6a
Watch out for this
The credit rate depends on when the property is “placed in service” — meaning operational and generating energy — not when you signed the contract or made the payment. If you paid for solar panels in 2025 but the system was not connected and producing electricity until 2026, the 2026 rate applies. For 2025 and 2026, the rate is the same 30%, but this distinction matters as the rate starts declining after 2032. 1
Footnotes
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IRS Form 5695 Instructions, Residential Energy Credits. https://www.irs.gov/pub/irs-pdf/i5695.pdf ↩ ↩2 ↩3
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Inflation Reduction Act Section 13302, Extension and Modification of Residential Clean Energy Credit. https://www.congress.gov/bill/117th-congress/house-bill/5376/text ↩