The federal tax credit for an electric panel upgrade ended for new installations placed in service after December 31, 2025. If your panel was up and running by that date and met the other conditions, you can still claim 30% of the cost, capped at $600, on the return you file for the year the work was completed.1Internal Revenue Service. FAQs for Modification of Sections 25C, 25D, 25E, 30C, 30D, 45L, 45W, and 179D Under the One Big Beautiful Bill The One Big Beautiful Bill, signed July 4, 2025, terminated the Energy Efficient Home Improvement Credit under Internal Revenue Code Section 25C for anything installed after that cutoff, regardless of when you signed the contract or paid the deposit.
The Panel Alone Never Qualified
This is where most homeowners misread the credit. Swapping in a bigger panel to modernize an old house, run a workshop, or feed an EV charger did not qualify on its own. The statute required the panel work to be done “in conjunction with” another qualified energy efficiency improvement or piece of energy equipment, and the panel had to “enable the installation and use” of that other improvement.2Office of the Law Revision Counsel. 26 U.S. Code 25C – Energy Efficient Home Improvement Credit3ENERGY STAR. Electric Panel Upgrade Tax Credit
Qualifying triggers included heat pumps, heat pump water heaters, central air conditioners, furnaces, insulation, windows, doors, and biomass stoves. If you upgraded the panel because your electrician said the new heat pump needed the capacity, the panel work rides along on the heat pump’s eligibility. If you upgraded the panel for any other reason, no credit.
The 200-Amp Minimum and Code Compliance
The new panel had to have a load capacity of at least 200 amps.4Office of the Law Revision Counsel. 26 USC 25C – Energy Efficient Home Improvement Credit A jump from 100 amps to 150 amps did not qualify. Most permitted modern upgrades hit 200 amps as a matter of course.
The installation also had to be consistent with the National Electric Code. Any licensed electrician pulling a permit will follow the NEC. Unpermitted work creates problems on both sides of that requirement: code compliance and the paper trail you would need in an audit.
Which Homes and Residents Qualified
The panel rule was broader than the rest of Section 25C. Most improvements under this credit only counted at your primary residence. Electrical panels could be installed at any home you used as a residence in the United States, including a second home, and renters who paid for their own panel upgrade were eligible.5Internal Revenue Service. Energy Efficient Home Improvement Credit – Qualifying Residence Condominiums, co-ops, mobile homes, and houseboats all counted.3ENERGY STAR. Electric Panel Upgrade Tax Credit Investment properties and rentals you did not live in did not.
How Much You Can Actually Claim
The credit equals 30% of qualifying expenses, but a per-item cap of $600 applies to the panel.2Office of the Law Revision Counsel. 26 U.S. Code 25C – Energy Efficient Home Improvement Credit Spend $2,500 on the panel and you get $600. Spend $10,000 and you still get $600. Thirty percent only controls the outcome for panel projects under about $2,000.
Eligible costs include the panel itself, sub-panels, branch circuits, feeders, wiring to connect the new energy equipment, and labor.6Internal Revenue Service. Energy Efficient Home Improvement Credit Because the $600 ceiling bites so quickly, the finer distinctions between includable and non-includable line items rarely change the result.
The $600 panel credit also counts against a broader $1,200 annual limit on this side of Section 25C, which covers things like insulation, windows, doors, and central air. That leaves up to $600 of headroom in the same year for other qualifying improvements in that bucket.6Internal Revenue Service. Energy Efficient Home Improvement Credit
Non-Refundable, No Carryforward
The credit can reduce your federal income tax to zero but cannot generate a refund on its own. Owe $400 and qualify for $600, and you use $400. The remaining $200 is gone. There is no carryforward to a later year.7Internal Revenue Service. Energy Efficient Home Improvement Credit – Timing of Credits
How to Claim It on Your Return
Use IRS Form 5695, Residential Energy Credits, Part II.8Internal Revenue Service. Instructions for Form 5695 (2025) Calculate 30% of qualifying expenses, apply the $600 panel cap and the $1,200 annual limit, and carry the result to Form 1040. The credit belongs on the return for the year the panel was placed in service, not the year you contracted or paid a deposit.
Keep the following in case the IRS asks:
- An itemized contractor invoice breaking out the panel, wiring, and labor from any other work.
- Proof of payment: receipts, canceled checks, or credit card statements.
- Documentation of the placed-in-service date showing the panel was operational.
- A Manufacturer Certification Statement for the primary energy equipment that triggered the panel’s eligibility.
If Your Panel Supported Solar or Battery Storage
A different credit may apply. The Residential Clean Energy Credit under Section 25D covered solar panels, battery storage, wind, and geothermal, at 30% with no per-item dollar cap. Its qualifying costs included “labor costs for onsite preparation, assembly or original installation of the property and for piping or wiring to connect it to the home.”9Internal Revenue Service. Residential Clean Energy Credit
If your electrician upgraded the panel specifically to support a new solar array or battery, the panel and wiring costs may fit under 25D rather than 25C, avoiding the $600 ceiling. Section 25D was also modified by the One Big Beautiful Bill, and the IRS has indicated the credit is unavailable for property placed in service after December 31, 2025.9Internal Revenue Service. Residential Clean Energy Credit For a solar-linked panel finished before that date, compare the two routes and use whichever gives the better result.
If Your Work Is Happening in 2026 or Later
No federal income tax credit currently exists for a panel upgrade placed in service after December 31, 2025. The signing date on your contract does not matter. What matters is when the work was operational.
The High-Efficiency Electric Home Rebate Act (HEEHRA) created a separate program of point-of-sale rebates for panel upgrades, wiring, and energy-efficient appliances. HEEHRA is federally funded but administered by state energy offices, so availability, application steps, and timing vary. Income eligibility is tied to household income relative to area median income, with larger rebates for lower-income households.
HEEHRA rebates are not tax credits. They reduce the purchase price at the register or reimburse you directly, which means they work even if you owe no federal tax. Some states have not yet launched their programs, and some that have are working through heavy demand. Your state energy office can tell you what is currently open where you live.