The Hawaii Solar Tax Credit Explained: How Homeowners Claim 35% in 2026

The Hawaii solar tax credit lets homeowners claim 35% of the cost of a new solar system on their state income taxes, capped at $5,000 per system for most single-family homes. With the federal residential credit gone as of 2026, this state credit is now the single most valuable solar incentive available to Hawaii homeowners. ProVision Solar helps every customer apply for it as part of the installation process. Here is exactly how the credit works, who qualifies, and how to claim it.

What Is the Hawaii Solar Tax Credit?

The Hawaii solar tax credit is officially called the Renewable Energy Technologies Income Tax Credit, or RETITC. It allows Hawaii taxpayers to claim 35% of the cost of an eligible renewable energy system, capped at $5,000 per system for single-family residential properties, per the Hawaii Department of Taxation. The credit applies against your Hawaii state income tax liability for the year the system is installed and placed in service.

The credit has been a pillar of Hawaii energy policy for years, supporting the state’s legal mandate of 100% renewable electricity by 2045, established in 2015 under HRS 269-92, per the Hawaii State Energy Office.

Who Qualifies for the Hawaii Solar Tax Credit in 2026?

Any Hawaii taxpayer who installs a qualifying solar system on a Hawaii property can generally claim the Hawaii solar tax credit, whether the property is a primary residence, second home, or rental. The system must be new, installed and placed in service during the tax year, and located in Hawaii. Each system on a property can qualify separately, which matters for larger projects that are engineered as multiple systems.

Homeowners with limited state tax liability still have options. Hawaii allows taxpayers to either carry unused credit forward to future years or elect a refundable version of the credit at a reduced rate. The right choice depends on your income and tax situation, so review it with a qualified tax professional before filing.

Does the Hawaii Solar Tax Credit Apply to Batteries?

The Hawaii solar tax credit is designed around renewable energy generation, so a battery is typically evaluated as part of the solar system it is installed with rather than on its own. Many homeowners pair panels with a Tesla Powerwall Installation in a single project. How the credit applies to your specific configuration is a tax question, and ProVision Solar always recommends confirming treatment with your tax professional.

How Do You Claim the Credit on Your Hawaii Taxes?

You claim the Hawaii solar tax credit by filing Form N-342 with your Hawaii state income tax return for the year your system was installed. The form calculates the credit from your actual system cost and applies the per-system cap. Keep your contract, final invoices, and proof of the date the system was placed in service, because those documents support the numbers on the form. If you install late in the year, confirm with your installer which tax year the system was placed in service, since that date controls when you can claim the credit.

ProVision Solar provides customers with the cost documentation needed for filing and walks you through what to hand your tax preparer. It is one part of how we handle the paperwork side of going solar, from permitting to incentive applications. You can review every current program on our Hawaii Solar Incentives page.

How Does the State Credit Compare to the Federal Credit Now?

The state credit is now the only solar tax credit available to Hawaii homeowners who purchase a system. The federal Residential Clean Energy Credit ended for systems installed after December 31, 2025, per the IRS. Hawaii’s 35% credit was unaffected by that federal change and remains fully in place for 2026 installations.

The state credit also stacks with other savings. Qualifying ProVision Solar customers can combine incentives with a financing partnership program that delivers savings of up to 40% on the entire system. See how it works on our Save Up To 40% page, then Contact Us Today to find out which programs your home qualifies for.

Frequently Asked Questions

How much is the Hawaii solar tax credit worth?

The Hawaii solar tax credit is worth 35% of the cost of an eligible solar system, capped at 5,000 dollars per system for most single-family residential properties. Larger properties with multiple qualifying systems may be able to claim more than one credit, subject to Hawaii Department of Taxation rules.

Is the Hawaii solar tax credit still available in 2026?

Yes. The Hawaii solar tax credit remains fully available for systems installed in 2026. It was not affected by the federal change that ended the residential federal solar credit for installations completed after December 31, 2025.

What form do I use to claim the Hawaii solar tax credit?

Hawaii taxpayers claim the credit by filing Form N-342 with their state income tax return for the year the system was installed and placed in service. Keep your contract and final invoices as documentation, and work with a qualified tax professional to choose between carryover and refundable treatment.

Can I claim the credit if I do not owe much state tax?

Yes, in most cases. Hawaii allows unused credit amounts to carry forward to future tax years, or taxpayers can elect a refundable version of the credit at a reduced rate. A tax professional can help you decide which option returns more money in your situation.

Put the 35% Credit to Work for Your Home

The Hawaii solar tax credit takes a meaningful bite out of the cost of going solar, and it pairs with financing and utility programs to shrink the number even further. ProVision Solar has guided island homeowners through solar incentives since 1998. Contact Us Today for a free quote that shows your price before and after every credit you qualify for.

Information pertaining to laws, regulations, or incentives is accurate at the time of writing this content. However, regulations and systems can change at anytime.