Happy Earth Day 2019
Earth Day was created in 1969 by environmental activists in response to an oil spill in waters near Santa Barbara, California. Since then, it has expanded each year as a day to emphasize environmental issues and inspire an appreciation of our planet.
With this year's celebration falling on a weekday, many folks are looking for ways to incorporate their pro-Mother Earth efforts into their daily lives.
Well, nothing is as incorporated into our day-to-day existences as our taxes.
So on Earth Day 2019 and every day this year, here are 4 tax-saving environmental options.
1. Electric vehicle credits: Millions of folks drove to their offices this morning. In most cases, their vehicles are powered by fossil fuel.
But there is a growing trend toward electric vehicles. And Uncle Sam can help you buy one of these autos.
A federal tax credit of up to $7,500 is available for some electric vehicles, or EVs as they're referred to in official transportation and tax material. Similar to the tax break provided for hybrid autos back when they were the enviro-friendly rage, the electric vehicle credit starts phasing out once the manufacturer sells 200,000 of the plug-in vehicles.
That means you'll get a small tax credit if you want one the most popular EVs. That's the case for Elon Musk's Tesla makes, as well as EVs manufactured by General Motors.
A Tesla or GM EV buyer now will get a federal tax credit of just $3,750. Remember, though, that this is a tax credit, which means you get a dollar-for-dollar reduction of any tax you owe.
Tesla led sales, so its credit reduction kicked in sooner, meaning the halved credit amount is available through June 30. GM's $3,750 credit runs through Sept. 30.
After those dates, the credit amounts will be cut in half again, eventually phasing out altogether.
2. Home is where the energy savings are: Unfortunately, the tax break for some relatively easy home improvements to make your residence more energy efficient have expired.
But the Residential Energy Efficient Property Credit is available 2021.
This credit, again the best type of tax break out there, is worth a 30 percent tax credit of the cost of solar-powered systems, such as sun driven water heaters and photovoltaic panels that produce a house's electricity.
That maximum credit is available for qualifying energy systems installed in 2019. It's reduced a bit in 2020 and 2021.
EnergyStar.gov has details on the tax benefits of installing these environmentally friendly systems.
3. Giving instead of taking from Mother Nature: The adage about it being better to give that to receive also applies environmentally.
And in these cases, if you itemize instead of taking the standard deduction, you could get some of your charitable gift back as a tax break.
Donations to IRS-approved nonprofits are still allowed under the Tax Cuts and Jobs Act. Your philanthropic gifts to 501(c)(3) approved environmental organizations count here.
If you don't have a favorite, just Google "environmental nonprofits" and get ready to be overwhelmed by how many green causes are out there.
4. Check out more local tax benefits: Finally, take to heart the "think globally, act locally" advice when it comes not only to energy saving situations, but also tax breaks.
There are myriad tax credits, rebates and other government-subsidized energy-related savings at state and local levels. You can find many of them in the directory at DSIRE, the acronym for Database of State Incentives for Renewables & Efficiency.
The site, according to its "About" Web page, is the most comprehensive source of information on incentives and policies that support renewable energy and energy efficiency in the United States. It's been around since 1995, is operated by the North Carolina Clean Energy Technology Center at North Carolina State University and is funded by the U.S. Department of Energy (DoE).
Speaking of DoE, there's the department's Energy.gov project. At that website, you can search, either nationally or by state, for programs that promote energy efficiency and offer rebates, savings and/or tax credits.
I hope you have enough energy left after celebrating this Earth Day to check out these environmentally conscious tax benefits. You deserve any and all you qualify for as a small reward for working to keep Mother Earth healthy.
You also might find these items of interest:
- China's new pollution tax excludes greenhouse gases
- Sweden looks at taxes to reduce wasteful consumerism
- Former GOP Treasury chief calls for global climate change action