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Section 48E Energy Community Checker

Understand the energy-community adder before your consultation.

The Section 48E energy-community adder adds 10 percentage points to the commercial investment tax credit for projects sited in designated energy communities. That moves the combined ITC from 30 percent to 40 percent.

This tool explains how the designation works, who can claim it, and what steps are needed to confirm eligibility for a specific project address.

Section 48E is a commercial credit -- this tool explains it, not residential credits
DOE list is updated periodically -- this tool is educational, not a definitive ruling
Zero residential credit (Section 25D expired December 31, 2025)
Results shown before any contact requirement

Energy Community Checker

Understand whether your project area may qualify for the Section 48E energy-community adder. This tool is educational and informational only. It does not determine eligibility.

Section 48E base ITC

30%

Commercial investment tax credit base rate, available to qualifying commercial systems, tax-exempt entities using direct pay, and third-party owners (lessors / PPA providers).

Energy-community adder

+10%

An additional 10 percentage points of ITC, available when the project is sited in a designated energy community. Stacks on top of the base rate.

Combined (if eligible)

40%

Base 30% plus energy-community adder 10%. The domestic-content adder (also 10%) can stack further, up to 50% total. Domestic content is a separate qualification.

Who can claim Section 48E and its adders

  • Commercial solar installations (business-owned systems)
  • Third-party owners (solar lessors and PPA providers) who own the equipment on a homeowner's roof
  • Tax-exempt organizations and nonprofits using direct-pay election under IRA provisions
  • Homeowners who purchase or directly finance their own residential solar system (Section 25D, which applied to homeowners, expired December 31, 2025)

Enter the ZIP code for the project site (not your home address if different). Used only to explain the energy-community concept for your region.

Section 48E construction-start deadline

To qualify for Section 48E (and the energy-community adder), construction must begin by July 4, 2026. Projects with construction started by that date have a placed-in-service window through December 31, 2030. Projects that miss the deadline lose the energy-community adder and the extended placed-in-service window.

Section 48E commercial ITC base rate (active through 2026-07-04 construction start)
30
Energy-community adder stacked on top of base rate (if eligible)
+10
Combined rate for energy-community projects (before domestic-content stacking)
40
Residential homeowner credit (Section 25D expired December 31, 2025)
$0

The designation process

How the DOE and IRS determine energy-community eligibility

Eligibility for the adder is not self-evident from a ZIP code or a map lookup. These four steps explain how the determination works from data publication to tax filing.

  1. Step 1: The DOE publishes the official list annually

    The Department of Energy publishes a list of census tracts and metropolitan statistical areas (MSAs) that qualify as energy communities under IRS Notice 2023-29 and subsequent guidance. The list is updated each year as fossil-fuel employment data from the Bureau of Labor Statistics changes.

  2. Step 2: Two qualification categories exist

    Category 1: census tracts (or tracts adjacent to them) where a coal mine or coal-fired power plant closed after 1999. Category 2: census tracts with 0.17 percent or more direct or indirect fossil-fuel employment. A project site can qualify under either category or both.

  3. Step 3: Determination is at the census-tract level, not ZIP code

    A ZIP code can span multiple census tracts. The project site address determines the census tract, and the census tract determines eligibility. Two neighboring street addresses in the same ZIP code can fall in different tracts with different eligibility status.

  4. Step 4: Eligibility must be confirmed before filing a credit claim

    The IRS requires taxpayers to determine and document energy-community status for the tax year in which the system is placed in service. Documentation typically includes the DOE tract lookup result and the applicable IRS notice or revenue procedure. A tax professional reviews and confirms before filing.

Who can claim this credit

Section 48E is a commercial credit, not a residential one

The One Big Beautiful Bill Act eliminated the residential solar tax credit (Section 25D) effective December 31, 2025. Homeowners who purchase or directly finance a solar system in 2026 receive no federal tax credit.

Section 48E -- the commercial investment tax credit that includes the energy-community adder -- is a separate credit that applies to:

  • Commercial and industrial solar installations owned by a business entity
  • Community solar projects
  • Third-party owners (solar leasing companies and power purchase agreement providers) who own equipment installed on a homeowner's roof
  • Tax-exempt nonprofits and government entities using the direct-pay election

The TPO connection for homeowners: if you lease a solar system or sign a PPA, the leasing company (not you) is the system owner and may claim Section 48E. Some lessors pass a portion of the credit value through as a lower rate. This is the only indirect path for a homeowner to benefit from 48E value.

Commercial solar projects must begin construction by July 4, 2026 to qualify for the 30 percent Section 48E federal tax credit. After that date, the system must be placed in service by December 31, 2027.

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Common questions

Section 48E and the energy-community adder

These questions cover what the checker explains, who can claim the adder, and how to confirm eligibility for a real project.

Commercial solar options

What is the energy-community adder and who can claim it?
The energy-community adder is an additional 10 percentage points of investment tax credit (ITC) available under Section 48E for qualifying commercial solar, battery, and clean energy projects sited in designated energy communities. It stacks on top of the 30 percent base ITC, for a combined 40 percent. It can be claimed by commercial system owners, tax-exempt entities using direct-pay election, and third-party owners (solar lessors and PPA providers). Homeowners who own and purchase their own residential system cannot claim it.

Can a homeowner benefit from the energy-community adder through a lease or PPA?
Indirectly, possibly. If you lease a solar system or sign a power purchase agreement, the third-party owner (the leasing company) owns the equipment and may claim Section 48E including the energy-community adder. Some lessors pass a portion of that credit value to you through a lower monthly lease rate or PPA rate. Whether and how much is passed through depends on the specific lease terms. This is the TPO (third-party ownership) path. It is not a guarantee of savings and depends on the offer from the leasing company.

Why does this tool not tell me definitively whether my ZIP qualifies?
Three reasons. First, eligibility is at the census-tract level, not the ZIP-code level. One ZIP can contain both eligible and non-eligible tracts. Second, the DOE list is updated annually as fossil-fuel employment data changes -- a tract that qualifies in 2025 may not qualify in 2026, or vice versa. Third, hardcoding a list into this tool would create a false impression of certainty and could go stale before a project is filed. The only reliable determination is a lookup against the current DOE map using the project site address, confirmed by a tax professional.

What is the construction-start deadline for Section 48E?
Under the One Big Beautiful Bill Act (Public Law 119-21, signed July 4, 2025), construction on a Section 48E project must begin by July 4, 2026, to qualify for the energy-community adder and the extended placed-in-service window through December 31, 2030. Projects that begin construction after that deadline lose the energy-community adder and must be placed in service by December 31, 2027 instead.

Can the energy-community adder stack with the domestic-content adder?
Yes. The domestic-content adder (also 10 percentage points) can stack with the energy-community adder, for a combined total up to 50 percent ITC. Domestic content requires that the iron and steel used in the system are produced in the United States and that a minimum percentage of the manufactured components are produced domestically. Domestic-content qualification is separate from energy-community qualification and requires its own documentation.

How does Section 48E differ from the old Section 48?
Section 48E is the successor commercial ITC created under the Inflation Reduction Act. It replaced the old Section 48 for systems placed in service after December 31, 2024. The key differences include: Section 48E uses a technology-neutral definition (qualifying clean energy property rather than a list of specific technologies), it retains the 30 percent base rate and the adder structure, and projects that qualify under 48E continue to receive 5-year MACRS depreciation. Projects that cannot qualify under 48E because they do not meet the clean-energy definition lose the 5-year MACRS.

Does this tool apply any residential credit to the energy-community concept?
No. The residential solar credit (Section 25D), the heat pump and insulation credit (Section 25C), and the EV charger credit (Section 30C) were all eliminated or expired under the One Big Beautiful Bill Act. This tool discusses Section 48E, which is a commercial credit. No residential credit is applied or implied anywhere on this page or in the tool.

Ready for a confirmed energy-community determination?

Our advisors run the project address against the current DOE energy-community maps and coordinate with a tax professional to confirm eligibility. This is part of a free commercial solar consultation -- no shared leads, no sales pressure.

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