Solar just got more American. The One Big Beautiful Bill Act is reshaping how you can claim federal tax credits for solar projects — with new FEOC restrictions and stronger incentives for domestic content. If you are an installer quoting jobs or a homeowner planning solar this year, the rules just got stricter, but there is still a clear path forward.
Welcome to the new reality of solar incentives in 2026. At RC City US, we help contractors, installers, and homeowners navigate these changes with practical sourcing and support from our Texas warehouse.
The Big Picture: Why the One Big Beautiful Bill Matters Right Now
The One Big Beautiful Bill Act, signed July 4, 2025, speeds up the phase-out of many clean energy tax credits while adding strict new rules around Foreign Entities of Concern (FEOC) and domestic content. The Clean Electricity Investment Tax Credit (48E ITC) and Production Tax Credit (45Y PTC) are still available, but most solar projects need to begin construction by mid-2026 (using IRS safe harbor rules) or be placed in service by the end of 2027 to lock them in.
For everyday readers: Think of the tax credit as a reward for going solar. The new law says you can still get it — but your project must avoid heavy reliance on certain foreign suppliers and favor U.S.-made parts where possible. This push supports American manufacturing and energy security.
FEOC Rules: Protecting Credits from Prohibited Foreign Entities
FEOC rules target companies with significant ties to China, Russia, Iran, or North Korea through ownership, control, or material assistance. If too much of your project’s manufactured components come from these prohibited foreign entities, you risk losing the entire tax credit. It is an all-or-nothing rule designed to keep U.S. taxpayer support focused on secure supply chains.
These restrictions apply to projects beginning construction after December 31, 2025. You calculate the Material Assistance Cost Ratio (MACR) — the percentage of relevant costs from non-FEOC sources. Thresholds start around 40% non-FEOC for solar in 2026 and rise over time. IRS Notice 2026-15 provides interim safe harbors using existing domestic content tables while fuller guidance develops.
Domestic Content Bonus: Rewarding Made-in-America Sourcing
This is the positive side. Meet U.S. manufacturing thresholds and you can add a bonus to your tax credit — up to 10 percentage points on the ITC or the equivalent on the PTC.
In plain terms: Use enough American steel, iron, and domestically produced components and you earn extra savings. Technically, it requires 100% U.S.-produced steel and iron plus a percentage of manufactured product costs from domestic sources. IRS safe harbor tables help classify components for solar arrays and storage systems. The domestic content bonus works alongside FEOC rules: you can earn the adder if you qualify, but failing the FEOC test can disqualify the full credit.
Key Takeaways for 2026 Projects:
- Begin construction by mid-2026 to maximize credit eligibility
- Calculate MACR carefully to avoid FEOC material assistance disqualification
- Leverage domestic content thresholds for the bonus adder
- Prepare supplier certifications and compliance documentation now
- Watch for full safe harbor tables expected by end of 2026
How RC City US Helps Installers and Homeowners Stay Compliant
RC City US, based in DeSoto, Texas, supplies solar panels, energy storage systems, and related components from our local warehouse. We support both residential installs and larger commercial jobs across the country.
Our inventory and services make it easier to meet the new requirements: - Access to panels and systems positioned for stronger domestic content alignment - Bulk shipping in pallets or full containers that speed up procurement - System design help, permitting assistance (especially in Texas), and DIY options - Free shipping on qualifying orders By working with a U.S.-based distributor, installers reduce supply chain uncertainty and customers gain peace of mind that their project has a better chance of qualifying for remaining credits.
What This Means for You in 2026
For homeowners and small businesses: The window for the strongest credits is narrowing. Ask your installer about FEOC-compliant options and domestic content eligibility. Choosing the right supplier early can avoid surprises at tax time.
For installers and contractors: Lock in beginning-of-construction documentation soon. Build a compliance file with MACR calculations and supplier certifications. Pairing solar with storage can offer slightly different thresholds and sometimes longer credit windows.
Short-term shifts may raise costs, but these changes are building a more secure, domestically rooted solar industry.
Questions about FEOC rules or domestic content for your next project? Contact the RC City US team at support@rccityus.com or visit rccity.us. We are here to help you keep your solar projects on track.