The solar industry has always evolved with policy shifts, but the One Big Beautiful Bill Act (OBBBA) introduces one of the biggest changes yet. For solar developers, business owners, and even communities looking at renewable energy, these new rules don’t just affect timing — they could decide whether your project qualifies for valuable federal tax credits.

The good news? The credits are still here. The challenge? The rules have tightened, and the clock is ticking.

At the heart of the OBBBA changes, the federal government kept the 30% Investment Tax Credit (ITC) intact. On top of that, developers can stack bonuses:

Up to 50% Total: You can earn additional 10% bonuses for using domestic materials and another 10% for projects located in “Energy Communities” (areas with historical fossil fuel-based economies).
100% Bonus Depreciation: This allows you to write off the entire cost of the solar system in the first year, providing an immediate and substantial tax shield against income.This is new, and an interesting twist where the Biden policies and the Trump policies are both in effect.

For projects that move quickly, this adds up to a powerful incentive — potentially covering 50% or more of project costs. But those benefits now come with stricter timelines and stricter definitions of what “construction start” really means.

What Changed?

The 5% Shortcut Is Gone for Big Projects

Until now, many projects qualified for tax credits by spending just 5% of their costs up front, and receiving project equipment within 3.5 months.
That “Safe Harbor” disappeared after September 2, 2025 for utility-scale solar.

👉 Only small solar projects (1.5 MW or less) can still use this shortcut. Larger projects must now prove real construction has started.

You Need Real Construction Work

The IRS now requires “physical work of a significant nature” — not just contracts and deposits.

✅ What counts: installing racks, pouring foundations, or having custom equipment built for your project.
❌ What doesn’t: permits, designs, paperwork, or buying generic equipment.

Deadlines Are Tighter

Start BEFORE July 4, 2026 → You’ll have up to 4 years to complete your system (through the end of 2030 if you start in 2026).
Start AFTER July 4, 2026 → You must be finished by December 31, 2027.

FEOC Restrictions Are Coming

Starting in 2026, new limits apply on projects that use too much equipment from “Foreign Entities of Concern” (mostly Chinese suppliers).

Projects started before December 31, 2025 skip the toughest part of these restrictions.
Waiting too long could mean more hurdles — or higher costs.

✅ What This Means for You

If you’re considering solar, this is the moment to act. By moving forward now:

Secure Maximum Credits: Lock in the 30% ITC plus any available bonus credits.
Avoid Future Hurdles: Protect your project from upcoming foreign sourcing restrictions and tighter deadlines.
Gain More Time: Ensure you have the maximum four-year window to complete your project.

🌞 Why Act With Us

At Solar Gain, we don’t just install solar — we help you navigate the rules, the incentives, the financing, and the deadlines so you capture every available benefit. Our team stays ahead of regulatory changes so you don’t have to.

The OBBBA rules are clear: time is running out. But with the right partner, you can still take full advantage.

📞 Contact us today to discuss your project, lock in your tax credits, and get started before these deadlines close the window on opportunity.

Written by Aastha Guliani