The tax law is packed with incentives designed to encourage people to invest in specific activities. If you look closely, you’ll find some that align with your own priorities.

Here are three ways you can upgrade your life while enjoying excellent tax incentives. These aren’t loopholes in the tax law. They are intentional benefits the government offers to encourage certain activities.

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Lease a Luxury Electric Vehicle

If you’re in the market for a luxury vehicle that you’ll use for business at least part of the time, leasing is far more advantageous tax-wise than buying right now—especially for electric vehicles.

The government wants more people to switch from gas-powered to electric vehicles, so it is offering up to $7,500 in tax credits to those who purchase them. Unfortunately for high-income earners, these tax credits cap out at modified adjusted gross income of $150,000 for single filers and $300,000 for married couples filing jointly.

That’s where the beauty of leasing comes in. Under the Inflation Reduction Act, the full tax credit is available to businesses that own a fleet of vehicles—including the dealer from which you will lease. Your lease cost should reflect this.

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Then, when you use the vehicle for business, you gain a business tax deduction. Because the government wants people to start and grow businesses, they allow business owners to deduct vehicle expenses. You can deduct a percentage of the lease payment equal to the time you use the vehicle exclusively for business. So, if your monthly lease is $1,000 and you use the car half the time for business, you can take a $6,000 annual deduction.

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Combine Leisure with Business Travel

Another way the government incentivizes people to start and grow businesses is by making business travel deductible, so why not use this to explore? All you need to do is spend 51 percent of your time on business, and an entire trip in the U.S. is deductible. Travel outside the U.S. is always deductible in proportion to the amount of time spent on business activities.

You need to follow four rules to make your travel—or any other expense—deductible. The first is that the expense must have a business purpose, so plan your travel accordingly. The IRS requires that the primary purpose of your trip is for business to count as a business deduction. Spend four and a half hours daily on business meetings and then enjoy exploring a new city or relaxing in a great hotel.

The next rule is the expense must be ordinary, which means the type of expense, cost, and frequency need to be typical for your type of business. It also must be necessary, which means it needs to increase the profitability of your business. And, finally, you must document it through receipts, accurate mileage logs, and other record-keeping.

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Another way to get the government to pay for your adventures is to own a vacation home. If you use the home personally for 14 days or less each year and rent it the rest of the time, it is primarily a rental property; the costs of maintaining the property become deductions against the rental income. If the home is primarily your personal vacation property, you may still be able to enjoy some tax incentives. If you rent the property for two weeks or less, the IRS will not tax you on that rental income. Work with your tax advisor to find the best solution for you and your family.

Install Home Solar Power

Are you tired of paying high electric bills? Upgrading to a new solar power system for your home or business can be a great addition to your wealth and tax strategies.

If you own your home and haven’t yet installed a solar power system, there are a lot of incentives to do so. Depending on where you live, various federal, state, and local incentives may be available to help offset the cost. These include tax credits, rebates, property tax exemptions, and accelerated depreciation. In addition, you can reduce or eliminate your electricity costs, which likely have been rising thanks to inflation. The home solar panel tax credit for tax year 2023 through 2032 is is 30% of eligible costs.

The best incentives, however, are reserved for business owners and real estate investors.

When you add solar to your business property, you can deduct the interest expense and/or finance costs associated with any loans you take out on the equipment. Then, you can deduct the depreciation on the equipment and take the business investment tax credit. Solar equipment is depreciated at about 20 percent per year for your federal taxes.

How to Unlock More Tax Benefits

Whether you are looking to reduce your energy costs, travel to incredible destinations, drive a luxury vehicle, or upgrade some other aspect of your life, there is a way to partner with the government to create a win-win. You just need to understand how to look at the tax law. Your tax advisor should be guiding you through this process.

Most people make the mistake of looking at taxes as a zero-sum game; in order for you to win, the government has to lose. That is not the case. The government incentivizes people to make certain types of investments that support government priorities. We all pay tax on income that we save and income that we spend. But, if we invest that income in government priorities, our investment helps us make more money while also paying less tax.