New! Car Loan Interest Deduction (OBBB)
The One Big Beautiful Bill (OBBB) created a temporary tax break for car buyers. Key points for 2025–2028:
• Deduct up to $10,000/year of interest paid on a new auto loan (personal use only).
• Standard deduction–friendly: You can claim this even if you don’t itemize.
• Loan must originate after Dec 31, 2024 and the vehicle must be assembled in the U.S. (light vehicles under 14,000 lbs—cars, SUVs, pickups, vans, motorcycles).
• VIN required on your tax return; lenders will furnish an interest statement for what you paid.
• Income limits apply: the benefit begins phasing out at $100k MAGI (single) / $200k (MFJ) and is fully phased out by $150k / $250k.
• Leases and used vehicles don’t qualify.
