Not Everyone Can Claim the New Car Loan Interest Deduction: What You Need To Know

KEY TAKEAWAYS Under a new tax break from the "One Big, Beautiful Bill," taxpayers will be able to deduct part of the interest they paid on a car loan in 2025. The vehicle must be new and have undergone final assembly in the United States. The car loan interest deduction is available to itemizing and non-itemizing taxpayers, and to those who make $150,000 or less ($250,000 for joint filers). If you purchased a new car in 2025, you may be able to deduct part of your loan payment from your taxes. A ...