Solar panel installation on a New York City home by Solar Pro

NYC Solar Incentives 2026: Every Rebate & Tax Credit

Updated July 2026. If you researched solar a year or two ago, the numbers you remember are out of date. The biggest federal solar incentive for homeowners ended on December 31, 2025 — but New York State and New York City incentives are still very much alive, and they are the reason solar still pencils out in the five boroughs. Here is an honest, current breakdown of what you can actually claim in 2026.

First, the big change: the 30% federal tax credit is gone

The federal Residential Clean Energy Credit (Section 25D) — the 30% credit nearly every solar company advertised — was terminated by the tax law signed in July 2025. It applied to systems whose installation was completed by December 31, 2025. There was no phase-down and no grace period.

What that means in plain English: if you buy a solar system with cash or a loan in 2026, you get $0 from the IRS. Be skeptical of any NYC installer still quoting you a “price after the 30% federal credit” — that discount no longer exists for purchased systems.

There is one exception. Third-party owned systems (solar leases and power purchase agreements) can still access a federal credit under Section 48E, which runs through 2027. In that structure the financing company owns the panels and claims the credit, then passes some of the benefit to you as a lower monthly payment. You do not own the system, and it can complicate a future home sale — but for a homeowner with little tax liability, it is worth pricing out.

What NYC homeowners can still claim in 2026

1. New York State Solar Tax Credit — 25%, up to $5,000

This is now the single largest incentive for most buyers. New York gives you a state income tax credit worth 25% of your system cost, capped at $5,000. You claim it with Form IT-255 in the tax year your system receives Permission to Operate from Con Edison. If your state tax bill is too small to use it all at once, you can carry the balance forward for up to five years. Unusually, New York allows this credit on leased and PPA systems too — not just purchased ones.

2. NYC Solar Property Tax Abatement — 30% over four years

This is the city-level incentive most homeowners have never heard of, and it is generous. For systems placed in service between January 1, 2024 and January 1, 2035, NYC abates 7.5% of your system cost per year for four consecutive years — 30% total, applied against your property tax bill. The annual cap is $62,500 or your actual property tax liability, whichever is lower.

Two things trip people up. The application (Form PTA4, filed with the NYC Department of Buildings) must be signed by a registered design professional, and it needs to be in by March 15 to take effect that same tax year. Also, properties already receiving certain benefits — 421-a, 421-b, 421-g, ICAP or PILOT — generally are not eligible. We handle the PTA4 filing as part of every job we install.

3. NY-Sun rebates — read this carefully

The standard-income NY-Sun Megawatt Block rebate closed in the Con Edison region in 2025. Most NYC homeowners can no longer get it, and any quote showing a standard NY-Sun rebate line item in 2026 deserves a hard question.

What is still open is NYSERDA’s Affordable Solar incentive for households at or below 80% of area median income, worth $0.80 per watt in Con Edison territory. On an 8 kW system that is $6,400 — a very large rebate. Income limits in NYC are higher than most people assume, so it is genuinely worth checking before you rule yourself out.

4. Sales tax exemption — about 8.875%

Residential solar equipment and installation are exempt from both the 4% New York State sales tax and NYC’s local sales tax. You do not apply for this; a licensed installer simply leaves it off your invoice. On a $32,000 system that is roughly $2,800 you never pay.

5. Net metering with Con Edison

Send excess power to the grid during the day, pull it back at night, and get credited. Residential solar customers in Con Ed territory can still use traditional net metering, with a small monthly Customer Benefit Contribution charge based on system size. Credits roll over month to month, which is what carries a NYC home through the short winter days.

What this looks like on a real 8 kW system

System cost: $32,000 (sales tax already exempt)
NY State tax credit (25%, capped): −$5,000
NYC property tax abatement (30% over 4 years, $2,400/yr): −$9,600
Effective net cost: about $17,400

That is roughly 46% off — without a single dollar of federal help. If you qualify for Affordable Solar, subtract another $6,400. Note that the abatement arrives as four years of lower property tax bills, not as cash on day one, so it changes your payback period rather than your upfront check.

FAQs

Is it still worth going solar in NYC without the federal credit? For most homes, yes. Con Edison has among the highest electricity rates in the country, and high rates — not tax credits — are what drive solar savings here. The state credit and city abatement still cover close to half the cost.

Should I have rushed to install in 2025? If you missed it, you missed it — but panel and equipment pricing has softened since, which offsets part of the loss. The bigger risk now is waiting on a rumored federal credit that has not been reinstated.

Do these incentives cover battery storage? The NYC property tax abatement covers qualifying battery storage installed with solar. The state credit is limited to solar equipment.

Who actually files all this paperwork? We do. Solar Pro handles the DOB and Fire Department permits, the PTA4 abatement filing, the Con Edison interconnection application, and we hand you the documentation you need for Form IT-255 at tax time.

Get an honest 2026 number

Any quote you receive this year should show a $0 federal credit line unless it is explicitly a lease or PPA. If yours doesn’t, ask why. We will walk your roof, model your actual Con Edison usage, and show you exactly which incentives you qualify for — with no 30% phantom discount baked into the math.

Solar Pro — 139 Stuyvesant Ave, Brooklyn, NY 11221. NABCEP-certified, BBB A+ rated, 5.0 stars. Solar and roofing under one roof.

Call (718) 962-7699 for a free, no-pressure assessment, or request a quote online.

This article is general information, not tax advice. Incentive programs and eligibility rules change — confirm your situation with a qualified tax professional before filing.