A landlord who didn't live in the home could never claim the federal geothermal credit. And since December 31, 2025, nobody can claim it for new installations, because Section 25D ended.
So for 2026 the answer is simple, but the rules still matter for 2025 returns. Here's what the IRS page for the ended 25D credit says, checked on October 9, 2026.
Could a Landlord Claim the Geothermal Tax Credit?
No. The IRS page for the 25D credit, which ended after December 31, 2025, says you can't claim it if you're a landlord or other property owner who doesn't live in the home. The credit was for improvements to your main home, whether you owned or rented it.
The IRS describes a main home as generally where you live most of the time. It also allowed a credit for certain improvements to a second U.S. home you live in part-time and don't rent to others.
Could a Tenant Claim It?
Yes, for 2025 and earlier installations. The IRS says the credit applied to improvements to your main home, whether you own or rent it. So a tenant who paid for a qualifying geothermal heat pump at their main home could claim the credit, but a landlord who didn't live there couldn't.
Qualifying geothermal heat pumps had to meet the ENERGY STAR requirements in effect at the time of purchase, according to the IRS.
What About a Home Used Partly for Business?
The IRS says business use of up to 20% still allowed the full credit. Above 20%, the credit was based on the share of expenses for nonbusiness use, and property used solely for business didn't qualify at all.
So a home office didn't block the credit on its own. But a property rented out in full was never eligible, because the owner didn't live there.
Has the Geothermal Tax Credit Ended?
Yes. IRS Fact Sheet FS-2025-05 says the 25D credit will not be allowed for any expenditures made after December 31, 2025, and an expenditure counts as made when installation is completed. So no 2026 geothermal installation qualifies, for owners, tenants or landlords.
Systems completed during 2025 are claimed on Form 5695 with the 2025 return. The geothermal tax credit answer page covers 2025 claims and carryforwards, and the guide to the federal home energy credits that ended lists every end date.
Official Sources
Every rule on this page comes from the IRS, checked on October 9, 2026.
- IRS: Residential Clean Energy Credit, who qualified, business use and geothermal requirements for the ended 25D credit
- IRS FS-2025-05, the IRS table showing when each credit ended
Frequently Asked Questions
Has the federal geothermal credit for rental property ended?
Yes. The 25D credit ended for expenditures made after December 31, 2025 (IRS FS-2025-05), and even before that, the IRS said landlords who don't live in the home couldn't claim it. A 2026 geothermal system on a rental property gets no federal residential credit.
Could renters claim the geothermal tax credit?
Yes, for qualifying installations completed by December 31, 2025. The IRS page for the 25D credit, which ended after December 31, 2025, says it applied to improvements to your main home whether you own or rent it, so a tenant who paid for a qualifying system at their main home could claim it on the 2025 return.
Is there a commercial geothermal tax credit for landlords?
This page covers the residential 25D credit only, which excluded landlords who don't live in the home and ended after December 31, 2025. Business energy credits are separate tax rules that we haven't verified here, so a landlord should ask a tax professional about any business credit for a rental property.
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