Fifteen percent, capped at $1,000
Under 830 CMR 62.6.1 the solar and wind energy credit is equal to fifteen percent of the net expenditure for renewable energy source property, or $1,000, whichever is less. It is claimed on Schedule EC, which is used for renewable solar and wind energy source property installed in a principal Massachusetts residence.
The eligibility wording matters. It is available to an owner or tenant of a residential property located in the commonwealth who occupies that property as his or her principal residence. A tenant paying for qualifying property in a home they occupy is contemplated by the regulation, which is unusual.
It is a credit against personal income tax, so it is only worth what you can actually use against tax owed. Ask a tax advisor how it applies to your circumstances rather than relying on a figure in a sales presentation.
Note the cap. At fifteen percent, a system costing more than about six or seven thousand dollars reaches the $1,000 limit, so beyond that point the credit does not grow with the size of the system. That matters for how you weigh it in a comparison.
Two more state benefits that need no application
Massachusetts provides a property tax exemption of 100 percent for 20 years for solar installations. The improvement does not raise your property tax bill the way a renovation of similar cost would, and over twenty years that is a real number.
Equipment for a solar, wind or heat pump system used as a primary or auxiliary energy source in a principal residence is exempt from sales and use tax. That one is applied at purchase, so check that your quote reflects it rather than assuming.
Neither of these arrives as a cheque, which is exactly why people leave both out of their own arithmetic. Add them alongside the bill savings and the incentive income when you are deciding whether a project makes sense.
Ask your installer whether the quoted price already reflects the sales tax exemption, and ask your municipal assessor what if anything they need for the property tax exemption at your address.
And the incentive that does most of the work
The largest state benefit is not the tax credit. The SMART program pays on metered production for a fixed term of 10 years for residential systems under 25 kW, at a rate determined when you enrol and locked for the duration.
It is provided to customers of Eversource, National Grid and Unitil. Customers of municipal light plants are not eligible, and Massachusetts has approximately 40 of them, so confirm your eligibility before anything else.
Payments are made directly by the utility via the same billing structure as net metering. Each month the utility reads the production meter and the owner receives the difference between the SMART rate and the value of the energy already credited through net metering.
So confirm that a production meter is included, who installs it, and how you can check it is still reporting later. The incentive is paid on metered production, and an unnoticed fault costs part of a ten-year entitlement.
Three state benefits, and the federal one that ended
Massachusetts has a state income tax credit of its own. Under 830 CMR 62.6.1 an owner or tenant of a residential property who occupies it as their principal residence is allowed a solar and wind energy credit against personal income tax equal to fifteen percent of the net expenditure for renewable energy source property, or $1,000, whichever is less. It is claimed on Schedule EC.
Note that it is available to a tenant as well as an owner, which is unusual and worth knowing if you are paying for a system on a property you occupy but do not own. Ask a tax advisor how it applies to your circumstances, since a credit is only worth what you can use against tax owed.
There is also a property tax exemption of 100 percent for 20 years for solar installations, and equipment for a solar system used as a primary or auxiliary energy source in a principal residence is exempt from sales and use tax. Neither arrives as a cheque, which is exactly why both get left out of people's own arithmetic.
On the federal side, the 30 percent Residential Clean Energy Credit under Section 25D expired for property placed in service after December 31, 2025, so a cash or loan purchase now receives no federal credit. Section 48E survives at 30 percent for third-party owners under leases and power purchase agreements, so ask any such provider what they claim and what of that value reaches you, and confirm with a tax advisor.