California’s active-solar property-tax exclusion becomes inoperative on January 1, 2027. A system that qualified before that date can remain excluded afterward until a subsequent change in ownership. For a homeowner keeping the property, that continuation matters. For a buyer, it is a reason to check the assessment rather than carry the seller’s tax estimate into the purchase budget.
A separate rule begins on the same date for an eligible initial purchaser of a new building with solar: the claim is timely when filed within three years of purchase. That filing period does not extend the cutoff for the underlying solar exclusion.
The practical question is which situation describes the home: an existing excluded system, a new installation, or a new building bought from a builder. Each calls for different records.
What the exclusion changes in a homeownership budget
This is a property-assessment rule. For a qualifying active solar energy system, the construction or addition is excluded from the definition of assessable new construction. The benefit concerns the value used to calculate property tax; it is different from an income-tax credit or a dollar-for-dollar reduction in a tax bill.
When comparing a home with solar, separate the assessment question from the system’s ownership, any payment obligation and its operating condition. A favorable answer on one does not settle the others. Ask for the solar agreement and payment records alongside the assessor’s records, then put the obligations that apply to you into the same budget.
Our guide to San Diego homeownership costs explains why the seller’s tax bill is only a starting point when comparing the full cost of a purchase.
What happens on January 1, 2027
The Board of Equalization’s September 1, 2026 letter to county assessors explains that Senate Bill 710 makes the exclusion inoperative, rather than repealed, on January 1, 2027. Its attached amended Revenue and Taxation Code section 73 preserves the exclusion for qualifying systems from before that date until a subsequent change in ownership.
For an installation being planned or completed near the cutoff, keep the construction and completion records. A signed installation contract by itself does not establish that the system qualified before January 1. Ask the Assessor how the actual completion status and dates affect the property before including an exclusion in a cost estimate.
If you already have excluded solar, obtain confirmation of that treatment. If you plan to sell, give the buyer the available records without promising that your assessment treatment will continue after the transfer.
| Your situation | The point to establish | Records to gather |
|---|---|---|
| Keeping a home with an existing exclusion | Whether the system qualified before January 1, 2027 and remains under the same ownership | Assessment records, installation records and the current ownership information |
| Buying a home with solar | The assessment treatment for your purchase, including the effect of the ownership change | Buyer-specific assessment estimate, solar agreement and the seller’s available records |
| Initial purchase of a new building from a builder | Underlying eligibility, the builder’s assessment history and the claim deadline | Purchase date, completion records, system value, rebates and BOE-64-SES |
The initial-purchaser claim has its own conditions
The initial-purchaser provision applies to a new building incorporating an active solar energy system. It is not a general claim for anyone buying a resale home with panels.
Under section 73(e), the owner-builder must not intend to occupy or use the building and must not have received the exclusion for the same system. The initial purchaser must buy before the building becomes subject to reassessment to the owner-builder under the referenced statutory rule, and must file the appropriate claim with the Assessor.
The claim identifies the value attributable to solar in the purchase price and relevant rebates. The Assessor evaluates the claim and determines the reduction under the statute. Ask the builder for those figures and the assessment history rather than assuming the panels’ advertised price is the amount that will be excluded.
The Board of Equalization separately explains that an owner adding a qualifying system to an existing structure generally does not file the initial-purchaser form; the exclusion should be granted through the Assessor’s receipt of the building permit. Keep that distinction clear when asking which records or form your situation needs.
The three-year filing period and a late claim
Operative January 1, 2027, Assembly Bill 1516 makes an initial-purchaser claim timely if it is filed within three years of the purchase date. An otherwise valid claim filed after that deadline receives prospective relief beginning on the lien date of the assessment year in which it is filed. The BOE letter describes the assessment year as the calendar-year period between lien dates.
That is a reason to preserve the purchase date and file a qualifying claim promptly. It is not a promise that a late filing will recover every earlier year’s tax, and the filing window does not create eligibility for a system that fails the underlying rules.
San Diego County’s solar exclusion claim information provides the local form and submission options. The County currently accepts a completed application and supporting information by email, mail or in person. Use the County’s current instructions when you file.
What to confirm before a purchase or sale
Start with the property address and parcel number, the installation and completion dates, who owns the system, and whether an exclusion has already been reflected in the assessment. For a new building, add the purchase date, builder’s information, system value, rebate records and any claim already filed.
Then ask the County Assessor the question that fits the transaction: does the present exclusion continue for this owner, does a proposed transfer change the treatment, or does this initial purchase qualify for a claim? Keep the response with the property records so the tax estimate and the transaction discussion use the same facts.
For a San Diego County buyer, I would compare the expected property tax and any solar payment with insurance, association costs and the rest of the home’s monthly expenses before choosing between otherwise similar properties. For a seller, organized records give the buyer a clearer basis for that comparison without promising an assessment result.
Solar property-tax questions
Will my existing solar exclusion disappear on January 1, 2027?
A system that qualified for the exclusion before January 1, 2027 can continue to be excluded afterward until a subsequent change in ownership. Confirm the system’s existing treatment with the Assessor, particularly when planning a sale or transfer.
Does the exclusion give me a tax credit?
It concerns the assessed value used for California property taxes. A qualifying system is excluded from new-construction assessment; this is different from a credit applied against an income-tax bill.
Who uses BOE-64-SES?
The form is for an eligible initial purchaser of a new building incorporating an active solar energy system. The builder and purchase conditions still matter. An owner adding a qualifying system to an existing structure generally does not file this initial-purchaser claim.
What changes for an initial purchaser’s filing deadline in 2027?
Operative January 1, 2027, a claim is timely if filed within three years of purchase. An otherwise valid late claim receives prospective relief beginning on the lien date of the assessment year in which it is filed. The filing rule does not extend the solar exclusion’s January 1, 2027 cutoff.
Can I assume the seller’s exclusion will carry over to me?
No. The statute limits the exclusion to the period before a subsequent change in ownership. Review the proposed transfer and the property’s assessment with the County Assessor, and build the purchase budget around the treatment that applies to you.