California’s Solar Property Tax Exclusion

California is one of the most solar-friendly states in the country, offering both incentives and policies that encourage homeowners to go solar. One of the most valuable—but sometimes overlooked—benefits is the California Solar Property Tax Exclusion. This policy ensures that when you install a solar energy system, the value it adds to your home won’t increase your property taxes.

But here’s the catch: this tax benefit isn’t permanent. It’s set to expire on January 1, 2027, unless extended. That means homeowners have just a limited window to install solar and lock in savings.

What Is the California Solar Property Tax Exclusion?

When you add improvements to your home—like a new room or pool—your property value rises, and so do your property taxes. Solar panels, however, are treated differently thanks to California’s Active Solar Energy System Property Tax Exclusion.

Under this policy, any increase in home value from a qualifying solar system installation is excluded from property tax assessments. In other words, your panels may add tens of thousands in market value, but you won’t pay extra taxes because of them.

Why This Matters for Homeowners

1. Bigger ROI on Solar – Without added property taxes, your solar savings stay where they belong—in your pocket.
2. Boosts Resale Value – Buyers see solar as a premium feature, and you can market your home as more valuable without worrying about higher tax burdens.
3. Time-Sensitive Savings – The exclusion is only in place until January 1, 2027, which means waiting too long could cost you.

How Does This Compare to the Federal Solar Tax Credit?

It’s important not to confuse the California Solar Property Tax Exclusion with the Federal Solar Investment Tax Credit (ITC). While both reduce the cost of going solar, they work in very different ways—and actually complement each other:

• Federal Solar ITC (Tax Credit):
  • Reduces your federal income taxes by 30% of your solar installation cost.
  • Schedule to end on December 31, 2025.
  • Example: A $20,000 system earns you a $6,000 tax credit when you file your federal taxes.
• California Solar Property Tax Exclusion:
  • Prevents your annual property taxes from increasing due to the added value of solar.
  • Does not provide upfront cash savings but protects you from long-term tax hikes.
  • Scheduled to end on January 1, 2027 unless extended by the state.

Together, these incentives mean California homeowners can save thousands upfront with the federal credit while also avoiding long-term costs with the state exclusion.

Who Qualifies for the Exclusion?

Most California homeowners installing a new, active solar energy system qualify. This includes:

• Roof-mounted and ground-mounted solar panels
• Solar thermal systems (like solar water heaters)
• Energy storage systems installed alongside solar

As long as your system is completed and operational before the 2027 sunset date, you can claim the exclusion.

Why Acting Now Matters

While 2027 may sound far away, installing solar isn’t always a quick process. Between permitting, financing, equipment availability, and installation timelines, projects can take weeks—or even months—to complete. Delaying could mean missing the deadline.

And with California electricity rates among the highest in the nation, the sooner you go solar, the sooner you start saving on energy bills.

How US Power Helps You Maximize This Benefit

At US Power, we don’t just install solar panels—we help you capture every available savings opportunity. Here’s how we make the process seamless:

• Expert Guidance – We walk you through state policies like the property tax exclusion and federal incentives like the 30% solar tax credit.
• Factory-Direct Advantage – With Qcells panels supplied directly through our partnership, we deliver high-quality systems faster and with better pricing.
• Streamlined Installation – Our in-house team ensures your system is installed on time, so you don’t miss critical deadlines.
• Long-Term Value – From design to monitoring, we make sure your system delivers maximum energy savings and adds long-term value to your home.

Final Takeaway

The California Solar Property Tax Exclusion is a powerful way to boost the value of your solar investment—but the clock is ticking. With the program set to end on January 1, 2027, homeowners who act now can secure years of extra savings and avoid higher costs down the road.

Ready to see if your home qualifies? Contact US Power today for a free solar assessment and lock in both state and federal benefits before they expire.