Does my car qualify?
The new federal car loan interest deduction lets you deduct up to $10,000 a year of interest on a new car bought with a loan taken out after December 31, 2024 - if the vehicle's final assembly is in the United States. Check a VIN, or work out what you could deduct.
Not tax advice · Not a government site · Reviewed 2026-10-07
Check your VIN
Your VIN stays in your browser. Nothing is sent to our servers - it goes only to NHTSA's public VIN decoder.
1. Check your VIN
We read NHTSA's public VIN decoder to see where your exact vehicle was assembled, its GVWR class and its vehicle type. Nothing is sent to our servers.
2. Confirm the personal rules
A VIN cannot tell us whether the car is new to you, whether you bought rather than leased, or how you use it. We give you a six-point checklist.
3. Estimate your deduction
Enter your loan and income in the calculator to see the deduction year by year, including the $10,000 cap and the income phase-out.
The five tests your car has to pass
The deduction lives in IRC §163(h)(4), added by the One Big Beautiful Bill Act and fleshed out by final regulations (T.D. 10054). Three tests are about the vehicle, two are about you and the loan.
| Test | What the law requires | How to check |
|---|---|---|
| Final assembly | Final assembly must be in the United States, Canada is not enough. | VIN checker (NHTSA plant data) and the "Final Assembly Point" on your window sticker |
| Weight | Gross vehicle weight rating under 14,000 lb. | VIN checker (GVWR class) and the driver's door-jamb label |
| Vehicle type | A car, minivan, van, SUV, pickup truck or motorcycle, made mainly for public-road use. | VIN checker (vehicle type and body class) |
| New vehicle | Your use must be the first use after it is sold, registered or titled. | You - the six-point checklist after a VIN check |
| The loan | Taken out after December 31, 2024, for the purchase, secured by a first lien on the car, and you must report the VIN on Schedule 1-A. | You - your loan agreement and the calculator |
Personal use must be expected to be more than 50% of your use of the vehicle. Read the full method and every source on How it works.
Popular models
60 of the 108 model pages we have built have US final assembly. 16 depend on the individual vehicle - the page tells you why.
Common questions
How much is the car loan interest deduction worth?
Up to $10,000 a year in interest, for each tax year from 2025 to 2028. An auto loan typically pays $2,000 to $6,000 of interest a year, so most qualifying buyers deduct all of it. At a 22% federal bracket that is roughly $450 to $1,300 a year in tax saved.
Do used cars qualify?
No. The loan has to be for a new vehicle - one where your use is the first use after it is sold, registered or titled. If nobody has taken delivery before you, the car is new even if the model year is older.
Do leases qualify?
No. Lease payments are not interest on indebtedness, and if you buy out your own lease the original use started with the leasing company, so the buyout does not qualify either. Refinancing a qualifying loan can work - the new loan stands in the shoes of the old one, but only up to the old balance and term.
Which vehicles have final assembly in the United States?
Among the 108 model pages we have built so far, 60 are assembled in the US, 32 are assembled outside the US, and 16 depend on the individual vehicle. Use the VIN checker above for a real answer about a specific car - the same nameplate can be built in more than one country.
What is the income limit?
The deduction phases out by $200 for every $1,000 (or part of $1,000) of MAGI above $100,000, or above $200,000 on a joint return. At $150,000 single or $250,000 joint the deduction is gone. Use the calculator to see your own numbers.
Is the deduction available for tax year 2025?
Yes. Interest paid in 2025 on a loan taken out after December 31, 2024 is deductible on your 2025 return, but the deduction is only allowed if you report the VIN on Schedule 1-A, Part IV.
Primary sources used on this site
- IRC §163(h)(4), added by the One Big Beautiful Bill Act of 2025, Pub. L. 119-21, §70203 (the car loan interest deduction) — accessed 2026-10-07.
- T.D. 10054, final regulations under 26 CFR §1.163-16 and §1.6050AA-1, 91 FR (September 8, 2026); effective November 9, 2026 — accessed 2026-10-07.
- Proposed regulations REG-113515-25 (91 FR 67, January 2, 2026) and IRS news release IR-2025-129 (December 31, 2025) — accessed 2026-10-07.
- IRS Schedule 1-A (Form 1040), Part IV "No Tax on Car Loan Interest", lines 22-30, and the IRS explainer for Schedule 1-A — accessed 2026-10-07.
- IRS Topic No. 505, Interest expense — accessed 2026-10-07.
- IRS Notice 2025-57 (2025 lender reporting transition relief) and Form 1098-VLI, Vehicle Loan Interest Statement — accessed 2026-10-07.
- NHTSA vPIC VIN decoder (named in the regulation preamble as a way to check the plant of manufacture) — accessed 2026-10-07.
- NHTSA Part 583 American Automobile Labeling Act (AALA) reports - final assembly point by carline, MY2025 and MY2026 — accessed 2026-10-07.
- NHTSA public VIN decoder - look up a vehicle's plant of manufacture yourself, without this site — accessed 2026-10-07.
We link to primary sources: the statute, the regulations, IRS forms and instructions, and NHTSA's own vehicle data. Where those sources do not settle a question, we say so rather than guess.
Last reviewed 2026-10-07. Vehicle data from NHTSA's Part 583 reports (MY2025 and MY2026) and the vPIC VIN decoder. If a source does not settle a question, the answer on this site is "check your VIN" rather than a guess.