By Benjamin Finnerty (S), REALTOR® (RS-83812) with Keller Williams Realty Maui · Kīhei, Maui · 808-481-9748

Quick Answer: The federal residential solar tax credit ended for 2026, but Hawaiʻi’s state solar tax credit still covers 35% of a home system’s cost, up to $5,000 per system. Act 24, signed May 21, 2026, adds a $40 million annual statewide cap and income limits starting in 2027, and phases the credit out by the end of the decade.

I’m Benjamin Finnerty, a REALTOR® in Kīhei, Maui, with Keller Williams Realty Maui. Solar comes up in almost every conversation about the cost of owning a home here, because electricity on Maui is expensive. The Hawaiʻi solar tax credit changed more in 2026 than it has in years, so here’s what’s still available, what changes in 2027, and what to check when the home you’re buying already has panels on the roof.

Is there still a federal tax credit for home solar in 2026?

No. Hawaiian Electric reported in August 2026 that the federal residential clean energy credit ended early, effective January 1, 2026. Even so, the utility said 3,429 rooftop systems were connected on its grids in the first half of 2026, including 434 in Maui County, along with 55 megawatts of battery storage. Hawaiian Electric also reports that 45% of its single-family-home customers statewide have rooftop solar.

How does the Hawaiʻi solar tax credit work in 2026?

For a single-family home, Hawaiʻi’s Renewable Energy Technologies Income Tax Credit (RETITC) is 35% of the system’s actual cost, capped at $5,000 per solar electric system. Solar water heating has its own cap of $2,250 per system. The credit is claimed on your Hawaiʻi income tax return.

Because of the cap, the credit tops out quickly on a typical home system:

System cost (example)	35% of cost	Credit, after the $5,000 cap
$10,000	$3,500	$3,500
$14,286	$5,000	$5,000
$25,000	$8,750	$5,000

These examples are illustrations of the formula, not quotes. Your installer and tax preparer can tell you what applies to your system.

What does Act 24 change for the Hawaiʻi solar tax credit?

Act 24 (SB 3125), signed by Governor Josh Green on May 21, 2026, keeps the credit but limits it. Based on the final bill text and the Governor’s office:

• Annual statewide cap: $40 million a year in allowable credits for 2027 through 2030, across all claimants.
• Income limits: For tax years beginning after December 31, 2026, the credit is limited to taxpayers with adjusted gross income of $175,000 or less filing individually, or $350,000 or less filing jointly.
• Certification: Taxpayers file with the Hawaiʻi State Energy Office by March 1 each year, and applicants are notified by May 31. If claims exceed the cap, credits are reduced proportionally.
• Sunset: The Governor’s office describes the credit as sunsetting in 2030.

Can I still get the full credit for solar installed in 2026?

Many 2026 systems are protected. Governor Green’s Executive Order 26-02, issued June 12, 2026, exempts systems placed in service in 2026 from the new cap when the taxpayer can show it relied on claiming the credit when it invested before Act 24 was signed. The Hawaiʻi State Energy Office says it is working with the Department of Taxation on implementation guidance, so check for updated filing instructions before you file.

What should I check when buying a Maui home that already has solar?

Start with ownership. A system you buy with the house is very different from a leased system or a power purchase agreement, which comes with a contract you may need to qualify for and take over. Ask the seller for:

• Ownership documents: purchase records, or the lease or power purchase agreement and its transfer terms
• Permits: the County of Maui building and electrical permits for the system, which you can look up in MAPPS (my guide to checking permits in MAPPS shows how)
• Utility paperwork: the Hawaiian Electric interconnection agreement and which customer program the system is enrolled in
• Warranties and age: panel, inverter and battery warranties, and whether they transfer
• Bills: 12 months of electric bills, so you can see what the system actually saves

My post on Maui electricity rates covers what you’ll pay for the power you still buy from the grid.

My Take: What I’m Telling Buyers and Homeowners

For homeowners thinking about adding solar, the 2026 window matters. With the federal credit gone, the state credit is the main tax incentive left, and the new cap and income limits start with 2027 tax years. If you’re planning a system, talk with your tax preparer about timing and whether you’d qualify under the 2027 rules.

For buyers, I’d treat solar as part of the house, with the same scrutiny as a roof or an addition. It’s very important to make sure there are no investigations from the county. For example, if there is a problem with electrical or plumbing permitting, it could create quite a headache for the new owner. Confirm the permits and the utility agreement before you’re past your inspection contingency.

For sellers with solar, gather the paperwork now: permits, the interconnection agreement, warranties and a year of bills. If the system is leased, find out what the lease company needs from a buyer, since that can affect your closing timeline.

General information, not tax or legal advice; confirm with a CPA or Hawaiʻi attorney.

Frequently Asked Questions

What is the Hawaiʻi solar tax credit for a home in 2026?
35% of the system’s cost, up to $5,000 per solar electric system on a single-family home, through the state Renewable Energy Technologies Income Tax Credit.

Did the federal solar tax credit end?
Yes. Hawaiian Electric reports the federal residential clean energy credit ended effective January 1, 2026.

What is Act 24?
A 2026 Hawaiʻi law, signed May 21, 2026, that adds a $40 million annual cap, income limits starting with 2027 tax years, State Energy Office certification and a scheduled sunset to the state credit.

What are Act 24’s income limits?
Adjusted gross income of $175,000 or less for individual filers and $350,000 or less for joint filers, for tax years beginning after December 31, 2026.

Does a leased solar system transfer with a Maui home?
It depends on the lease. Ask the seller for the agreement early and check the transfer requirements with the solar company.

Ask Benjamin

If you’re buying or selling a Maui home with solar and want a second set of eyes on the paperwork, I’m Benjamin Finnerty, and I’m glad to help you sort out what to ask for. Call or text 808-481-9748 or email benjamin@the808team.com.

Sources: Hawaiian Electric (Aug. 11, 2026 rooftop solar release); Office of the Governor, Executive Order 26-02 (June 12, 2026); Hawaiʻi State Legislature, SB 3125 CD2 (Act 24, 2026); Hawaiʻi State Energy Office; Honolulu Civil Beat (May 29, 2026); Honolulu Star-Advertiser (June 12, 2026); pv magazine USA (May 11, 2026).