Loading NuWatt Energy...
We use your location to provide localized solar offers and incentives.
We serve MA, NH, CT, RI, ME, VT, NJ, PA, and TX
Loading NuWatt Energy...
The 100% property tax exemption is Texas’s most valuable solar incentive in 2026 now that the federal 25D residential tax credit has expired. File Form 50-123 with your county appraisal district by April 30 and save $400–$600 per year in property taxes — over $10,000 across your system’s lifetime.
To receive the property tax exemption on your 2026 tax bill, you must file Form 50-123 with your county appraisal district by April 30, 2026. This is filed locally with your county — not the IRS, not the state comptroller. If you already have solar installed and have not filed, you may be overpaying property taxes right now.
Texas has some of the highest property tax rates in the nation. Without this exemption, solar would increase your tax bill by hundreds of dollars every year.
System Value
$22,000
Tax Rate
2.31%
Annual Savings
$508/yr
25-Year Savings
$12,710
Calculation: $22,000 system value × 2.31% tax rate = $508 saved per year × 25 years = $12,710 total savings
Filing takes about 15 minutes and could save you over $12,000 across your system’s lifetime. Here is exactly what to do.
Get the official Application for Exemption of Solar or Wind-Powered Energy Device from the Texas Comptroller of Public Accounts website. The form is also known as the "Exemption Application for Solar or Wind-Powered Energy Devices." Make sure you download the most current version.
Tip: Search "Form 50-123 Texas Comptroller" or visit comptroller.texas.gov.
Fill in your property details: legal description, property ID number (found on your tax statement), your name as it appears on the deed, and a description of the solar energy device installed. Include the installation date, system size in kW, and whether it is roof-mounted or ground-mounted.
Tip: Your property ID is on your most recent county tax statement or appraisal notice.
Include supporting documentation: the signed installation contract, final invoice showing equipment and labor costs, city/county building permit, and the inspection certificate or certificate of completion. Photos of the installed system are helpful but typically not required.
Tip: A final invoice from your installer is the most commonly accepted proof.
Mail or hand-deliver the completed Form 50-123 and attachments to YOUR county appraisal district (CAD). This is NOT the IRS, NOT the state comptroller, and NOT your utility company. Each Texas county has its own CAD. Most also accept email or online submissions.
Tip: Find your CAD at comptroller.texas.gov/taxes/property-tax/county-directory.
The county appraisal district will review your application and send a confirmation letter. Processing time varies by county but is typically 2 to 6 weeks. Some counties may send an appraiser to verify the installation, though this is uncommon for residential solar.
Tip: If you have not heard back in 6 weeks, call your CAD directly.
When your next property tax statement arrives, verify that the solar exemption appears as a line item. The assessed value of your home should reflect the exemption, meaning the value added by your solar system is excluded from your taxable amount. If it does not appear, contact your CAD immediately.
Tip: The exemption should appear under "Exemptions" on your annual appraisal notice.
Property tax rates vary significantly across Texas. Below are estimated annual savings for a typical $22,000 residential solar system in the 10 largest metro areas.
Tax rates reflect combined county, city, school district, and special district rates. Actual rates may vary by exact location within a county.
| County | Major City | Effective Tax Rate | Annual Savings | 25-Year Savings |
|---|---|---|---|---|
Harris | Houston | 2.31% | $508/yr | $12,710 |
Dallas | Dallas | 2.17% | $477/yr | $11,935 |
Travis | Austin | 1.98% | $436/yr | $10,890 |
Bexar | San Antonio | 2.23% | $491/yr | $12,265 |
Tarrant | Fort Worth | 2.26% | $497/yr | $12,430 |
El Paso | El Paso | 2.48% | $546/yr | $13,640 |
Collin | Plano / Frisco | 2.07% | $455/yr | $11,385 |
Nueces | Corpus Christi | 2.16% | $475/yr | $11,880 |
Lubbock | Lubbock | 2.02% | $444/yr | $11,110 |
Hidalgo | McAllen | 2.35% | $517/yr | $12,925 |
Houston
Annual Savings
$508
25-Year Total
$12,710
Dallas
Annual Savings
$477
25-Year Total
$11,935
Austin
Annual Savings
$436
25-Year Total
$10,890
San Antonio
Annual Savings
$491
25-Year Total
$12,265
Fort Worth
Annual Savings
$497
25-Year Total
$12,430
El Paso
Annual Savings
$546
25-Year Total
$13,640
Plano / Frisco
Annual Savings
$455
25-Year Total
$11,385
Corpus Christi
Annual Savings
$475
25-Year Total
$11,880
Lubbock
Annual Savings
$444
25-Year Total
$11,110
McAllen
Annual Savings
$517
25-Year Total
$12,925
Savings based on a $22,000 solar system value with exemption removing 100% of solar-added value from the tax base. Actual savings depend on your exact location, school district, and special district rates. El Paso County has the highest effective rate among major Texas metros at 2.48%, yielding the largest savings. Tax rates sourced from the Texas Comptroller, February 2026.
These errors cost Texas homeowners hundreds of dollars per year in unnecessary property taxes. Make sure you avoid all five.
Many Texas homeowners do not know this exemption exists. The property tax exemption is not automatic and requires a separate filing. Without it, your county will tax you on the increased home value from solar, costing $400 to $600 per year.
The correct form is Form 50-123, specifically for solar and wind-powered energy devices. Do not use the homestead exemption form (Form 50-114), the general exemption application (Form 50-296), or any other property tax form. Only Form 50-123 applies to solar.
The standard deadline to file for the current tax year is April 30. If you file after this date, you may lose the exemption for the current tax year and have to wait until the following year. Some counties accept late filings, but this is not guaranteed.
Unlike some states where solar tax exemptions are applied automatically, Texas requires you to actively file with your county appraisal district. Your solar installer will not file this for you. Your utility will not file this for you. You must do it yourself.
If you expand or upgrade your solar system (e.g., adding panels or battery storage), the new equipment adds additional value to your home. You should file a new or amended Form 50-123 to ensure the full system value is exempted. Battery storage added later may qualify under the same exemption.
Missed the deadline? You may still be able to file. Here is what to know about late applications.
Each county has its own appraisal district office. Call or visit their website to confirm:
Find your CAD: Visit the Texas Comptroller County Directory at comptroller.texas.gov/taxes/property-tax/county-directory
Texas Senate Bill 419 — Solar Energy Device Tax Exemption
Before SB 419, some county appraisal districts interpreted the exemption narrowly, potentially excluding installation labor costs or applying only a partial exemption. SB 419 removed this ambiguity and established that the full value added by a solar energy device — including all components and installation — must be exempted from property taxation. This ensures consistent application of the exemption across all 254 Texas counties.
With the federal 25D tax credit gone, stacking the property tax exemption with net metering or solar buyback is the strongest incentive combination available to Texas homeowners in 2026.
$400–$600
saved per year in property taxes
$600–$1,200
earned per year from excess energy
$1,000–$1,800
total annual benefit from both programs
This is the most effective incentive stack for Texas homeowners in 2026 since the federal 25D tax credit expired.
The federal residential solar Investment Tax Credit (Section 25D) expired on December 31, 2025, under the One Big Beautiful Bill Act (OBBBA) signed on July 4, 2025. This means there is zero federal tax credit for residential solar panel purchases in 2026.
Previously, homeowners could claim 30% of their solar system cost as a federal tax credit. For a $22,000 system, that was $6,600 back in tax savings. That incentive is now gone.
This makes the Texas property tax exemption even more critical. While it does not provide an upfront cash benefit like the ITC did, it delivers consistent annual savings of $400 to $600 per year for as long as your solar system operates — potentially 25 to 30+ years.
Also note: Texas has no state income tax, so there are no state-level solar tax credits available. The property tax exemption and utility buyback programs are the only incentives remaining for Texas residential solar in 2026.
TX Tax Code §11.27 defines what counts as a “solar energy device” and what is covered by the exemption.
Note on leased systems: If you lease your solar panels, the leasing company (not you) files for the property tax exemption since they own the equipment.
Common questions about the Texas solar property tax exemption, Form 50-123, and filing deadlines.
The Texas solar property tax exemption, under TX Tax Code Section 11.27, provides a 100% property tax exemption on the appraised value that solar energy devices add to your home. This means that when solar panels increase your home value by $15,000 to $25,000, you pay zero additional property taxes on that increased value. You must file Form 50-123 with your county appraisal district to receive the exemption.
The standard filing deadline is April 30 of the tax year for which you are requesting the exemption. For example, to receive the exemption on your 2026 property taxes, you should file by April 30, 2026. However, most Texas counties accept late applications and some allow retroactive filing for up to two prior tax years. Contact your county appraisal district for their specific late-filing policy.
Your savings depend on your county property tax rate and the value your solar system adds to your home. For a typical $22,000 residential solar system, annual savings range from about $400 to $600 per year depending on your county. Over 25 years, this adds up to $10,000 to $14,000 in total property tax savings. Texas has some of the highest property tax rates in the country, making this exemption especially valuable.
No. Once approved, the Texas solar property tax exemption remains in effect as long as the solar energy device is installed and operational on your property. You do not need to renew or refile annually. However, if you significantly expand your system (add more panels or battery storage), you should file an updated Form 50-123 to cover the additional equipment value.
Texas Tax Code Section 11.27 specifically covers "solar energy devices." Battery storage systems that are installed as part of a solar energy system and are used to store solar-generated electricity generally qualify under the same exemption. If you add battery storage after the initial solar installation, file an updated or new Form 50-123 to ensure the battery value is also exempted.
No. The federal residential solar tax credit (Section 25D) expired on December 31, 2025, under the One Big Beautiful Bill Act (OBBBA) signed July 4, 2025. There is zero federal tax credit for residential solar purchases in 2026. The Texas property tax exemption is now the single most valuable solar incentive available to Texas homeowners, saving $400 to $600 per year for the lifetime of your system.
Some Texas solar installers offer to file Form 50-123 on your behalf as part of their installation service. While this is helpful, you should verify that the filing was actually completed by contacting your county appraisal district directly. Ultimately, you are responsible for ensuring the exemption is in place. If your installer did not file it, you can file it yourself at any time.
No. The property tax exemption does not reduce your home sale price or appraised market value. It only exempts the solar-added value from property taxation. When you sell your home, the solar system still adds value to the sale price. Studies show solar homes sell for 3 to 4 percent more than comparable non-solar homes. The exemption simply means you do not pay higher property taxes while you own the home.
Explore our other Texas energy guides to maximize your savings.
Full pricing breakdown by city, system size, and financing option.
Read GuideUtility-by-utility heat pump rebate guide for Oncor, Austin Energy, CPS Energy.
Read GuideUp to $3,000 through the Austin Energy Power Saver program.
Read GuideSan Antonio Casa Verde program: $100 to $275 per ton.
Read GuideElectricity rate comparison by metro: DFW, Houston, Austin, San Antonio.
Read GuideRegional heat pump pricing from $1,500 (mini-split) to $28,000 (geothermal).
Read GuideThe property tax exemption saves $400–$600/year. Pair it with competitive solar pricing to maximize your total savings. Get a free, no-obligation quote today.
Last updated: February 2026. Data reflects Texas property tax rates for the 2025–2026 tax year. Savings estimates are based on a $22,000 residential solar system. Actual savings depend on system size, county tax rates, and local assessment practices. This guide is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional for guidance specific to your situation.