Car Loan Interest Deduction Calculator
The One, Big, Beautiful Bill Act lets you deduct up to $10,000 in auto loan interest for US-manufactured vehicles. Enter your income and loan details below to see how much you save.
annual savings ($30/month)
- Car loan interest paid
- $3,000
- After $10,000 cap
- $3,000
- Deductible amount
- $3,000
8.37%
Before
7.77%
After OBBBA
- ✓Vehicle is manufactured or assembled in the United States
- ✓Vehicle is used primarily for personal transportation
- ✓The loan is a bona fide auto loan (not a HELOC or other credit line)
- ✓Interest is actually paid during the tax year (not just accrued)
This deduction applies to federal income tax only. Available for tax years 2025–2028.
How the OBBBA Car Loan Interest Deduction Works
Deduction Cap
Up to $10,000 in car loan interest per return. This is an above-the-line deduction — you don't need to itemize.
US-Made Requirement
Only vehicles manufactured or assembled in the United States qualify. Check your VIN or window sticker for assembly location.
Income Phase-Out
Deduction reduces proportionally for AGI between $100,000–$150,000 (single) or $200,000–$300,000 (MFJ). Zero above the upper limit.
Tax Years 2025–2028
The provision is temporary — it applies to tax years 2025 through 2028 unless extended by Congress.
Frequently asked questions
Who qualifies for the OBBBA car loan interest deduction?
Taxpayers who pay interest on an auto loan for a vehicle manufactured or assembled in the US. The vehicle must be used primarily for personal transportation, and the loan must be a bona fide auto loan.
What vehicles qualify for the deduction?
Vehicles manufactured or assembled in the United States — including foreign brands with US assembly plants. Check your vehicle's VIN or window sticker for assembly location.
How does the phase-out work?
The deduction reduces proportionally between $100K–$150K AGI (single/HoH/MFS) and $200K–$300K (MFJ). At the midpoint you get half; above the upper limit, zero.
Can I claim this with other OBBBA deductions?
Yes. The car loan, tip, overtime, and senior bonus deductions are all independent. You can claim every one you qualify for.