President Trump may have reneged on the Paris climate deal, but there are still green strategies that environmentally (and financially) conscious consumers can use to reduce their carbon footprint—and also save some money.
The 2015 Paris accord, agreed to by 195 nations, is widely considered critical in efforts to curb the greenhouse gas emissions that cause global warming, and the U.S had been expected to play a leadership role.
Full withdrawal from the accord is likely to take until 2020, and a future president could reverse Trump's decision.
Mark Luscombe, principal federal tax analyst for Wolters Kluwer Tax Accounting, based in Riverwoods, Ill., says there are several federal credits that consumers should know about.
Solar Installations
Until 2021, you can install solar technology on your roof and get a tax benefit. Under the Residential Energy Efficient Property Credit, your tax credit this year would be 30 percent of the cost of installing the system. The credit will fall to 22 percent in its last year. After that it goes away altogether.
"Solar is becoming a self-sufficient business," says Luscombe. "The need for tax credits is subsiding."
Some states also offer incentives, but they vary greatly. You can find the amount where you live by inputting your ZIP code into the Database of State Incentives for Renewables & Efficiency.
In addition to the tax credits, you also stand to save on your home's energy expenses. How much depends on many variables, including whether you buy or rent the panels, the cost of installing them, and how much sun you get in the area in which you live.
Electric Cars
If you buy a new, plug-in electric car, you might be able to get a federal tax credit worth up to $7,500. Among the cars that qualify: the Chevy Bolt and Volt, BMW i3, and Tesla Models S and X.
The credit you receive is a bit complicated to figure out, but the IRS offers a table so that you can see how big your benefit would be.
The main factor that determines your tax credit is the kind of battery the car uses. A 4-kilowatt-hour battery gets you a tax credit of $2,500. For every additional kilowatt-hour your battery provides, you get an additional $417 credit up to a maximum of $7,500.
Luscombe cautions that these credits won't be around forever. As soon as a manufacturer has sold 200,000 cars in that model line, the credit begins phasing out over a period of four calendar quarters. The good news, though, is that none of the car manufacturers are even close to that cutoff, he says.
There are also no income restrictions, so even if you are worth millions or billions, you still qualify for the credit. But if the credit exceeds your federal income tax liability, you lose it. You are not allowed to carry the excess forward for use in future years.
Conservation Easements
Another idea: If you put an easement on land you own so that it can't be used for development, you're doing good for the planet and can get a significant tax deduction, says Tom Wheelwright, CEO of ProVision Wealth Strategies in Tempe, Ariz.
There are a variety of factors that go into determining the total deduction, but it generally amounts to the difference between the value of the property and the estimated value of the property if it had been developed. That means you'll have to hire a developer to create plans.
The expense could be worthwhile. Wheelwright says that if your land is worth $1 million and the development costs are estimated to be $1 million and the value of the finished property is estimated to have been $5 million, you'd be able to get a charitable deduction of $3 million.
It's a great deduction, says Wheelwright, especially for those who own the property but never wanted to develop it in the first place.
