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The Big Beautiful Bill: 2025 Deadlines and Impact on Commercial & Multifamily Solar

Written by Citadel Roofing & Solar | Nov. 05, 2025

The Big Beautiful Bill and Commercial and Multifamily Solar: 2025 Impact and Deadlines

For more than a decade, the federal Investment Tax Credit (ITC) has offered a stable foundation for commercial solar development, allowing businesses to plan with confidence as they reduce upfront costs and improve ROI. On July 4, 2025, the One Big Beautiful Bill (OBBB) was signed into law, changing the game with tighter timelines and new project requirements to qualify for incentives.

While the updates can be overwhelming, we’ve sorted through the fine print for you. Here’s how the Big Beautiful Bill impacts commercial solar projects in 2025 and why acting now can help maximize your savings and capture all the benefits of clean solar power. 

How does the Big Beautiful Bill affect commercial solar?
Most significantly, the OBBB places new restrictions on The Clean Energy Investment (48E) and Production Tax Credits (45Y) which cover the investment in and production of clean energy technology. The new law shortens the deadlines on the tax credit. Under the original Inflation Reduction Act (IRA), businesses had until 2032 to take advantage of the full 30% tax credit. The Big Beautiful Bill moves that sunset date up to December 31, 2027 for systems that are placed in service by then. 

However, the law also gives developers a way to extend their eligibility through safe harbor, a provision that locks in today’s tax rate if your project has begun before the deadline. With safe harbor, you can extend the window for completion to December 31, 2030.

To meet safe harbor requirements, a project must do one of the following:

  • Incurring at least 5% of the total project cost 
  • Performing “physical work of a significant nature.”

This allows businesses to secure their tax credit early and also gives them more time to finish construction.



Under recent guidance (effective Sept 2, 2025), solar projects larger than 1.5 MW generally must use the Physical Work Test (the 5 % Safe Harbor is largely no longer available for them), whereas smaller systems (≤ 1.5 MW) may still use the cost test. 

These updated rules apply to commercial solar and hybrid solar-plus-storage projects. 

Three Big Reasons to Act Now

The One Big Beautiful Bill also makes changes to domestic content thresholds to qualify for tax credit “adders,” implements stricter supply chain rules, and limits timelines for bonus depreciation. For businesses considering solar, these updates shape how projects are planned and financed. Here are three reasons that may influence your decision.

1. Lock in Full Tax Benefits
The tax credit may cover more than you realize. Businesses can apply the full 30% ITC to interconnection, permitting and installation costs for rooftop, ground-mount, and carport solar installations, as well as battery storage systems. In addition to the base incentive, projects can still maximize benefits with bonus tax credits by:

Note: Battery storage systems have separate domestic content thresholds, which differ from solar panel requirements.

  1. Avoid Stricter Sourcing Rules

The One Big Beautiful Bill also specifies new sourcing restrictions for 2026. It limits sourcing components and materials from “foreign entities of concern” (FEOC), like China, Russia, North Korea, and Iran. Starting in 2026, businesses will need to ensure they use a growing percentage of components from non-FEOC suppliers or risk losing tax credit eligibility:

  1. Use Transferability and Bonus Depreciation to Boost ROI
    The Big Beautiful Bill reinstated two of the most significant tax features for commercial solar: tax credit transferability and 100% bonus depreciation. Together, these tools give businesses more flexibility in financing, stronger near-term savings, and faster ROI.
  • Credit transferability allows businesses to sell unused clean-energy tax credits to another, unrelated taxpayer if they can’t fully use them themselves. Under Section 6418 of the Internal Revenue Code, and reaffirmed through the One Big Beautiful Bill (OBBB), eligible commercial solar developers can monetize their tax credits directly rather than structuring complex and costly tax-equity partnerships. This streamlined approach helps businesses improve cash flow, reduce financing friction, and free up capital for new projects. By transferring the credit, companies can unlock immediate liquidity while maintaining ownership of their solar assets. However, under the OBBB, credits cannot be transferred to “specified foreign entities” or foreign-influenced entities, ensuring that these tax benefits remain within the U.S. market. Despite this limitation, tax experts note that transferability remains one of the most effective ways to maximize the value of a commercial solar investment, as confirmed by recent analyses from Moss Adams and CLA Connect.
  • Bonus depreciation allows businesses to deduct the full cost of eligible solar and energy storage systems in the first year of service. The One Big Beautiful Bill returned 100% bonus depreciation (retroactive to January 19, 2025) and replaced the previous 40% phase-down. This is a major shift from the traditional 5-year MACRS schedule. It gives organizations stronger upfront tax savings and improves cash flow. For some, this creates immediate financial relief; for others, it reshapes how clean electricity investments appear on the balance sheet and in long-term planning.

Taken together, credit transferability and bonus depreciation make solar more financially attractive and accessible. But these provisions won’t last forever. Starting projects now helps businesses take advantage of these incentives while they’re still available. 

Who Can Capture Big Beautiful Bill Commercial Solar Benefits in 2025?
While every sector stands to gain from going solar sooner, some have the most to lose if they delay. Those best positioned to benefit from commercial solar legislation in 2025 include:

  • Business owners with significant tax exposure who want to offset liability and secure long-term energy savings.
  • Commercial property operators from retail centers and office parks to mixed-use developments looking to improve asset value and cut operating costs.
  • Energy-intensive facilities like manufacturers, warehouses, and logistics hubs that have major power expenses.
  • Corporate ESG and sustainability teams building carbon reduction strategies on tight timelines.
  • Solar developers and EPCs with projects slated for 2026–2028 that must meet safe harbor or construction-start rules to preserve full credit value.
  • Nonprofits, schools, hospitals, and public entities that can still leverage direct pay options even without tax liability.

For any project planned past early 2026, the window to lock in construction or safe harbor is closing quickly. Starting projects now will allow businesses to take advantage of solar tax incentives.

The Clock is Ticking for Maximum Solar Savings
The Big Beautiful Bill fundamentally changes how businesses will approach solar projects. While the full 30% tax credit remains available, the window to qualify is closing quickly. If you start your solar project in 2025, you can still access the current incentives. Waiting until 2026 or later means dealing with stricter rules and potentially smaller tax benefits. 

At Citadel Roofing and Solar, we’ve been helping California businesses navigate policy changes for over 20 years. Our team stays current on federal and local regulations to help you understand exactly what these deadlines mean.

And with commercial IOU utility rates increasing more than 70% over the last five years,  solar continues to be in high demand which means our installation schedule is filling up fast as the deadline approaches!  Book a free consultation with our experts to get started!
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