No Tax on Car Loan Interest

The following provision changed due to H.R. 1, One Big Beautiful Bill Act:

A deduction is allowed for up to $10,000 of interest on a qualified passenger vehicle loan used to purchase a new passenger vehicle after December 31, 2024 (does not apply to used car purchases). A qualified passenger vehicle is a car, minivan, van, sport utility vehicle, pickup truck, or motorcycle with a gross vehicle weight of less than 14,000 pounds. Final assembly of the qualified vehicle must occur in the U.S. The Vehicle Identification Number (VIN) must be included on the return. The allowable deduction is reduced if the taxpayer’s MAGI exceeds $100,000 ($200,000 if MFJ). The deduction is allowed for non-itemizers.