Energy Credits Expiring Under OBBBA

Individual Energy Credits Expiring in 2025 Due to OBBBA – Act Now

If you’ve been considering investing in solar panels, replacing your windows, or upgrading your vehicle to something more energy-efficient, now is the time to act.

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, not only made some tax provisions permanent, but also set a firm expiration date for several popular clean energy credits. These tax incentives aimed to encourage eco-conscious upgrades for homeowners, so if you’re considering investing in energy efficiency or clean vehicle upgrades, there’s one message you need to hear loud and clear:

Several of the most popular clean energy tax credits are set to expire in 2025, with some as soon as September.

This article focuses specifically on individual energy credits expiring in 2025, and what steps you can take to make use of these tax credits before they expire. Other provisions may sunset later, but these are the ones you need to act on now to avoid missing out.

What Are Energy Tax Credits?

A tax credit is a direct reduction of your tax bill—unlike a deduction, which simply reduces your taxable income. If you qualify for a $1,200 tax credit, that’s $1,200 off what you owe the IRS.

Many energy-related credits are non-refundable, meaning they can reduce your tax liability to $0, but won’t result in a refund beyond that. A few (like certain clean vehicle credits) may be refundable or offer transfer-at-sale benefits.

For a deeper dive, check out our quick explainers:

• Understanding Refundable Tax Credits »
• What Are Non-Refundable Tax Credits? »
• Clean Vehicle Credit Breakdown »

Now, let’s break down what’s expiring, and when.

Clean Energy Tax Credits Expiring in 2025 Under OBBBA

1. Previously Owned Clean Vehicle Credit (IRC §25E)

Expires: September 30, 2025
Credit Value: 30% of sale price, up to $4,000

This credit helps individuals purchase used clean energy vehicles, such as electric or fuel-cell cars. To qualify:

• • Buy from a licensed dealer
  • Vehicle must be at least 2 years old
  • Sale price must be $25,000 or less

MAGI under:

• • $75,000 (single)
  • $150,000 (married filing jointly)

You cannot:

• • Be claimed as a dependent
  • Have claimed this credit in the last 3 years

Learn more: Full Guide to Clean Vehicle Tax Credits »

2. New Clean Vehicle Credit (IRC §30D)

Expires: September 30, 2025
Credit Value: Up to $7,500

This credit supports the purchase of new electric or fuel-cell vehicles, but only if both the car and the buyer meet IRS criteria:

MSRP must be below:

• • $80,000 for trucks/SUVs/vans
  • $55,000 for other vehicles

MAGI under:

• • $150,000 (single)
  • $300,000 (married filing jointly)

Vehicle must meet strict battery and manufacturing sourcing requirements. Not all EVs qualify—use the IRS list of eligible vehicles to double-check.

3. Energy Efficient Home Improvement Credit (IRC §25C)

Expires: December 31, 2025
Credit Value: 30% of qualified costs, up to $1,200 annually (certain limits apply)

This credit offsets the cost of energy-saving upgrades made to your primary residence. Covered improvements include:

• • Exterior doors (max $250 per door, 2-door limit)
  • Exterior windows and skylights (max $600)
  • Insulation and air sealing materials
  • Energy-efficient central air conditioners, furnaces, boilers, water heaters
  • Heat pumps and biomass stoves or boilers (up to $2,000)
  • Home energy audits (up to $150)

Who qualifies?
Any taxpayer who owns a U.S. primary residence can qualify. Rental properties and second homes do not count. If you were planning to make these improvements anyway, accelerating your decision ASAP ensures you can claim the maximum benefit.

4. Residential Clean Energy Credit (IRC §25D)

Expires: December 31, 2025
Credit Value: 30% of total qualified cost, with no dollar cap

This robust credit covers major investments in renewable energy systems for your home, including:

• • Solar electric (photovoltaic) panels
  • Solar water heating systems
  • Wind turbines
  • Geothermal heat pumps
  • Fuel cell property (limits apply)
  • Battery storage systems

Who qualifies?
Taxpayers who install qualifying systems in their primary or secondary residence within the U.S. Note: Fuel cell systems must be for a primary residence only. Projects not completed and placed in service by the expiration may lose eligibility.

Act Now – Recommended Steps

These credits were previously extended through 2032 under the Inflation Reduction Act, but with the passing of OBBBA, it dramatically shortened that timeline. As of now, no extensions or replacements have been announced, which means this is a last call to finish up projects or purchases.

Some credits, especially those for clean vehicles, require advance planning, verification, and income eligibility. If you’re hoping to claim these in your 2025 return here’s what we recommend in this narrow timeframe:

• Talk to an advisor ASAP– if you’re not sure whether you’ll qualify for a tax credit or how to claim one, it’s best to consult with your advisor as soon as possible.
• Book contractors early– as demand to complete eco projects before the new year, installation and delivery timelines might become tighter
• Keep Detailed invoices– This credit only applies to costs actually paid and placed in service before the deadline, so make sure you keep a well documented paper trail.
• Check IRS Eligibility lists– Especially for EV credits, manufacturer compliance matters. Just because the deadline is pushed up doesn’t mean you should rush your research

Conclusion

While the rest of OBBBA brought permanent changes or new temporary provisions, this section of the new bill is all about urgency. If you’re planning to invest in clean energy or energy efficiency, now is your last chance to take advantage of these federal incentives currently in place.

If you want to benefit from these credits, or if you’re unsure what qualifies, Please connect with us online, or reach out to us directly at 1-770-495-9077 or email us at [email protected].

The above article only intends to provide general financial information and is based on open-source facts, it is not designed to provide specific advice or recommendations for any individual. It does not give personalized tax, financial, or other business and professional advice. Before taking any form of action, you should consult a financial professional who understands your particular situation. CKH Group will not be held liable for any harm/errors/claims arising from the articles. Whilst every effort has been taken to ensure the accuracy of the contents, we will not be held accountable for any changes that are beyond our control.