Does Solar Raise Your Property Tax in California?
Short answer: not if it is finished in time. California’s active solar energy system exclusion (Revenue and Taxation Code §73) keeps a qualifying system out of your assessed value, so your property tax does not rise because of it. Under current law the exclusion ends on January 1, 2027: the State Board of Equalization says it covers systems completed before that date, and systems already excluded stay excluded until the home changes hands. A bill to extend it stalled in committee in May 2026.
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- It is an exclusion, not an exemption: adding a qualifying system neither raises nor lowers your assessment. No form is needed; the assessor learns about it from the permit.
- The deadline: under §73 as it stands, the exclusion covers solar completed before January 1, 2027. Work started in 2026 but finished later is not covered unless the Legislature extends the law.
- Once excluded, it stays excluded until the property changes ownership; a sale resets the assessment to the purchase price anyway.
- New homes with solar: the first buyer from the builder must file a claim with the county assessor to have the system’s value taken off the new assessment.
- Included: storage and other equipment that is part of a solar electric system, leased or owned. Not included: solar pool and hot tub heaters.
Does adding solar increase property taxes in California?
No — for a qualifying system completed before January 1, 2027.
Under Proposition 13, your assessed value is based on the purchase price and grows only slowly each year; new construction is added on top. Normally, anything of value built onto a property is assessed at market value and added to the base. Section 73 says the construction or addition of an active solar energy system is not “new construction,” so the system is never added (R&T Code §73). The State Board of Equalization stresses that this is an exclusion, not an exemption: the installation neither increases nor decreases the existing assessment (BOE).
There is nothing to file when you add solar to a home you already own; the assessor usually finds out through the building permit. If your assessment rises after an installation, contact the county assessor. Ownership does not matter: a leased system is excluded just like an owned one (BOE FAQ). Your home’s market value can still rise with solar — a different number; see do solar panels increase home value.
The January 1, 2027 deadline
What “completed in time” means.
Section 73 remains in effect only until January 1, 2027; systems that qualify before then stay excluded on and after that date until there is a change in ownership (§73(i)). The 2025 amendment, SB 710, changed the section from repealed to inoperative on that date and did not extend it (SB 710).
Because the statute names both the 2025–26 fiscal year and January 1, 2027, the Board of Equalization issued guidance in August 2024: the exclusion applies to any solar new construction completed on any day before January 1, 2027. Construction in progress added during 2026 is excluded only if it is completed before that date; work still unfinished on January 1, 2027 is not (BOE Letter to Assessors 2024/031). A 2026 bill, AB 2389, would have extended the exclusion for home-size systems through 2030; it was held in the Assembly Appropriations Committee on May 14, 2026 (AB 2389 history). The Legislature can still act, so check the law when you sign.
What it would add
The California Constitution limits the general property tax rate to 1% of full cash value (SB 710 digest). If the exclusion lapses and an assessor adds a new system to your base, each $10,000 of added value means about $100 a year at that 1% rate, plus local voter-approved charges on your bill. How an assessor would value a system is up to the county. Cali Energy arithmetic, not tax advice.
New-construction homes with solar
The buyer has to claim it.
When a builder puts solar on a new home it does not plan to live in, the exclusion can pass to the first buyer. The buyer files form BOE-64-SES, the “Initial Purchaser Claim for Solar Energy System New Construction Exclusion,” with the county assessor. It asks for the purchase and installation dates, the value of the solar system included in the price, with documents, any rebate paid to the builder or the buyer, and the builder’s name and contact (BOE-64-SES sample). The assessor then lowers the new base-year value by the system’s value minus those rebates (§73(e); BOE FAQ).
Timing matters. The buyer qualifies only if the purchase happens before the home becomes assessable to the builder: in the Board’s example, a home completed in November qualifies if it sells by December 31, but not if it sells after the January 1 lien date (BOE FAQ). From January 1, 2027, a claim filed within three years of the purchase is timely, and a later claim applies from the year it is filed (§73(e)(1)(A)). Ask the builder for the claim form and the system value at closing. For the code that requires solar on new homes, see solar on new-construction homes.
| Situation | Property tax treatment | What you do |
|---|---|---|
| Solar panels added to your existing home | Excluded if completed before Jan 1, 2027 | Nothing |
| Leased or PPA system on your roof | Excluded, same as owned | Nothing |
| Battery that is part of the solar system | Included as “storage devices” | Nothing |
| Solar pool or hot tub heater | Not covered | — |
| New home bought from the builder with solar | Excluded for the first buyer who claims it | File form BOE-64-SES with the county assessor |
| Home sold later | Exclusion ends at the change in ownership | Buyer’s base is the purchase price |
Sources: R&T Code §73 (b), (d), (e), (f), (i) · BOE FAQ · BOE LTA 2024/031. A battery installed without solar is not a solar system; ask the assessor how it will be treated.
When you sell
The exclusion lasts only until the next change in ownership (§73(f)). That rarely surprises anyone, because a sale resets the assessment to the purchase price, which already reflects whatever the buyer paid for a home with solar. Leases, transfers and disclosures are in selling a house with solar.
If you are installing in late 2026
Ask about completion, not signing
The Board’s test is completion before January 1, 2027. Ask the installer for a realistic finish date, including inspection.
Keep the paperwork
Hold on to the permit, the final inspection record and the contract in case the assessor asks when the system was finished.
Watch for an extension
Bills like AB 2389 show the Legislature has considered extending the exclusion; check the current law before relying on a date.
Ask the assessor
Your county assessor decides how a system is assessed. Contact them if your assessment changes after an installation.
Where to go next
Cali Energy is a licensed Los Angeles solar, battery and electrical contractor (CSLB #1032379). We can tell you how long design, permits and installation usually take for your home, so you can plan around the deadline. Call +1-323-844-7777 or ask about a 2026 installation. This page is general information, not tax advice.
Frequently asked
Will installing solar raise my property taxes in California?
Not for a qualifying system completed before January 1, 2027. Revenue and Taxation Code §73 excludes active solar energy systems from “new construction,” so the system is not added to your assessed value, whether it is owned or leased. After that date the exclusion ends unless the Legislature extends it.
What is the active solar energy system exclusion?
A California property tax rule, §73, that keeps the value of a qualifying solar system out of your assessment. It is an exclusion, not an exemption: your existing assessment neither rises nor falls. It covers solar electric and solar water heating systems, including storage that is part of a solar electric system, but not pool or hot tub heaters.
When does the California solar property tax exclusion expire?
Under current law, on January 1, 2027. The Board of Equalization says it covers systems completed before that date, and those stay excluded until the property changes ownership. AB 2389, which would have extended it through 2030 for home-size systems, was held in committee in May 2026.
Do new-construction homes with solar have higher property taxes in California?
Not if the first buyer claims the exclusion. The buyer files an initial purchaser claim with the county assessor, and the new base-year value is reduced by the system’s value minus rebates. The purchase must happen before the home becomes assessable to the builder, and the system must be completed before January 1, 2027 under current law.
If I sell my house, will the solar make the buyer's taxes go up?
The exclusion ends at the sale, but the buyer’s assessment is set from the purchase price anyway, which already reflects what they paid for a home with solar.
Do I need to apply for the solar property tax exclusion?
Not when you add solar to a home you own: there is no form, and the assessor learns about it from the permit. Buyers of new homes with builder-installed solar must file the initial purchaser claim with the county assessor on form BOE-64-SES.
Related reading
Sources & methodology
Figures on this page come from the primary sources below and, where noted, from Cali Energy calculations using the stated assumptions. Rates, incentives, and program terms change; each was verified October 5, 2026.
- California Revenue and Taxation Code §73 (as amended by SB 710, Stats. 2025, ch. 328)
- California State Board of Equalization — Active Solar Energy System Exclusion
- BOE — Active Solar Energy System Exclusion FAQs (leases, filing, initial purchaser)
- BOE — Letter to Assessors No. 2024/031: clarification of sunset date (August 26, 2024)
- SB 710 (2025) — Property taxation: active solar energy systems (text and digest)
- AB 2389 (2026) — extension bill, history: held under submission May 14, 2026
- BOE — form BOE-64-SES, Initial Purchaser Claim for Solar Energy System New Construction Exclusion (sample, rev. 07-25)
Planning solar before the 2027 deadline?
Tell us about your home and utility and we’ll give you an itemized estimate and a realistic timeline from contract to final inspection. General information, not tax advice.
Get a free estimatePrepared by Cali Energy, October 5, 2026. This article is for general educational purposes only and is not legal, tax, financial, engineering, or utility advice. Rates, incentives, codes, permit requirements, equipment specifications, prices, and program terms may change; figures and timelines are estimates, not guarantees. Confirm current requirements with the applicable utility, AHJ, program administrator, manufacturer, or a licensed professional. See our Content Disclaimer. Cali Energy · 19201 Parthenia St, Unit E, Northridge, CA 91324 · CSLB #1032379 (B, C-10, C-39)