Solar Lease vs. Buying in 2026: Which Still Gets You a Tax Credit?

Here's a fact that surprises most homeowners researching solar in 2026: the 30% federal solar tax credit isn't actually gone. It just no longer applies to you if you buy the system yourself.

That single detail flips the traditional "always buy if you can afford it" advice on its head, at least for this year. Here's how the options actually compare now.

Quick Recap: What Changed

Through the end of 2025, homeowners who purchased a solar system — with cash or a loan — could claim 30% of the cost back through the federal Residential Clean Energy Credit. That credit ended for homeowner-owned systems placed in service on or after January 1, 2026.

However, that same 30% credit still applies to solar systems owned by a third party — meaning companies that install systems under a lease or Power Purchase Agreement (PPA) can still claim it under the commercial clean energy credit, currently available through at least 2027 for qualifying projects.

That's the whole shift: ownership determines eligibility now, not just how the electricity gets used.

Option 1: Cash Purchase

You own it. No federal credit applies.

You pay the full cost upfront and own the system outright. You keep 100% of your electricity savings from day one, and solar typically adds to your home's resale value. Without the tax credit, your break-even point takes longer to reach than it did in 2025, but once you cross it, everything after is savings with no ongoing payment.

Best for: homeowners with available cash, a longer time horizon in the home, and a preference for owning the asset outright.

Option 2: Solar Loan

You still own it. Still no federal credit.

Same tax treatment as a cash purchase — you're the owner, so the residential credit doesn't apply. The difference is you finance it instead of paying upfront, usually with little or no money down. Your loan payment is offset by lower utility bills, and once paid off, you own a fully paid asset.

Best for: homeowners who want ownership and long-term savings but don't want to pay the full cost upfront.

Option 3: Lease or PPA

A company owns it. The 30% credit still applies — to them.

With a lease, you pay a fixed monthly rate for the equipment. With a PPA, you pay per kilowatt-hour for the power it generates, typically at a rate below your utility's price. In both cases, the company that owns the system can claim the 30% commercial tax credit, and competitive providers often pass some of that value on to you through a lower rate or $0-down installation.

You don't own the system, so you generally won't see the same resale value bump homeowners get from ownership, and if you sell your home, the lease or PPA typically needs to transfer to the new owner.

Best for: homeowners who want lower bills with no upfront cost and aren't focused on owning the equipment outright.

Side-by-Side: What Actually Matters

So Which One Should You Pick?

There isn't a universal right answer — it depends on what you're optimizing for:

• Maximum long-term savings and ownership: cash purchase or loan usually wins over 20-25 years, even without the tax credit
• Lowest possible upfront cost and simplicity: a lease or PPA is often the more accessible entry point in 2026, since it's the option still connected to a 30% credit
• Planning to sell your home soon: ownership adds resale value; leases/PPAs add a transfer step buyers may push back on

The honest move is to get real numbers for your specific home under both structures before deciding — the "right" answer for your neighbor isn't automatically right for you.

The Bottom Line

The 2026 tax credit changes didn't kill solar savings — they just moved the finish line. Whether that finish line still favors you depends on which ownership path you take, and that's worth running the numbers on before you sign anything.

Curious which option actually saves you more? SolarCentral will walk you through a side-by-side comparison for your home, including what — if any — incentives still apply based on how you finance it.