IRS issues advice on Trump’s major changes

The Internal Revenue Service (IRS) has issued new guidance on the upcoming end of several key tax credits for both homes and vehicles. Taxpayers have a limited window to take advantage of these incentives.

Why It Matters

The changes stem from the passage of the One Big Beautiful Bill Act, President Donald Trump’s sweeping spending agenda, which was signed into law in early July. Among other provisions, the legislation sets the stage for a broad set of tax reforms beginning in 2025.

Homeowners, vehicle buyers, and businesses who have relied on tax credits to offset costs for energy-efficient improvements and clean vehicles are now facing confirmed deadlines as many of these benefits are being phased out.

What To Know

The IRS has confirmed that eight tax credits will be ending across 2025 and 2026, affecting both residential and commercial property improvements as well as new and previously owned clean vehicles.

Homeowners looking to make energy-efficient upgrades should act quickly. The Energy Efficient Home Improvement Credit, which helps cover certain energy-saving improvements and is worth up to $3,200, will no longer be available for property placed in service after December 31, 2025.

Likewise, the Residential Clean Energy Credit, commonly known as the solar tax credit, will also expire at the end of 2025, affecting eligible solar panels and other qualifying systems.

The New Energy Efficient Home Credit, which provides up to $3,200 for qualified improvements made after January 1, 2023, will not apply to homes acquired after June 30, 2026. Commercial property owners face similar limits: the Energy Efficient Commercial Buildings Deduction for energy-efficient commercial building property or retrofits will not apply to any property whose construction begins after June 30, 2026.

Vehicle buyers and businesses should also take note. The Previously Owned Clean Vehicles Credit, offering 30 percent of the sale price up to $4,000 for used electric or fuel cell vehicles purchased for $25,000 or less, will not apply to vehicles acquired after September 30, 2025.

The New Clean Vehicle Credit, worth up to $7,500, and the Qualified Commercial Clean Vehicle Credit, worth up to $40,000 for businesses and tax-exempt organizations, share the same September 30, 2025 cutoff.

Finally, the Alternative Fuel Vehicle Refueling Property Credit, which applies to installations for clean-burning fuel or EV charging at home or a business, will not apply to property placed in service after June 30, 2026.

What Happens Next

Taxpayers planning to take advantage of these incentives should carefully review timelines and consult with a tax professional to ensure they maximize available benefits before the deadlines.

Acting early could mean the difference between securing a substantial credit and missing out entirely.