The IRS has announced a major change that will affect homeowners, businesses, and eco-friendly buyers across the US. As part of the One Big Beautiful Bill Act, several popular green tax credits for energy-efficient homes and clean vehicles will end between late 2025 and 2026.
These credits have been helping people save money on solar panels, electric vehicles, insulation, and other upgrades. With their expiry coming soon, taxpayers need to act fast if they want to take full advantage.
Green Tax Credits Ending After 2025
The IRS has confirmed that two of the most popular incentives will disappear by the end of 2025:
Energy Efficient Home Improvement Credit
Residential Clean Energy Credit
Both will no longer apply for properties placed in service after December 31, 2025. This will reduce financial support for solar panels, home insulation, and other renewable energy investments.
Impact on Businesses
It’s not just homeowners who will be affected. The Energy Efficient Commercial Buildings Deduction will also end for projects starting after June 30, 2026. This means businesses planning green construction must act quickly if they want to cut costs while going green.
Steps to Take Before Credits Expire
If you’re considering sustainable upgrades, now is the right time. Here’s what taxpayers should focus on:
Install solar panels and renewable energy systems before 2025 ends.
Buy electric vehicles while credits are still available.
Improve insulation and energy efficiency in homes and offices.
Consult a tax professional to maximize benefits.
Clean Vehicle Credits Expiring in 2025
Several key credits for electric vehicles are set to end on September 30, 2025:
Previously Owned Clean Vehicles Credit
New Clean Vehicle Credit worth $7,500
Qualified Commercial Clean Vehicle Credit of up to $40,000
To qualify, buyers must take possession of the vehicle, complete a binding contract, and make payment before the September deadline. Dealers must also provide a time-of-sale report at delivery or within three days.
Why This Matters for EV Buyers
These credits have helped boost the electric vehicle market by making EVs more affordable. But critics argue they are too expensive and unfairly push consumers towards EVs. Despite the political debate, one fact is clear: once the credits are gone, the cost of buying an EV will rise. Acting before the deadline could mean big savings.
The phase-out of green tax credits marks a turning point for homeowners, businesses, and car buyers. These incentives have played a huge role in promoting clean energy and sustainable choices. With deadlines set for late 2025 and 2026, the window of opportunity is closing fast.
Whether you’re planning solar installations, home improvements, or an EV purchase, acting now could save you thousands. The message is simple: don’t wait, because once the credits expire, they may never return.
