Ref: One Big Beautiful Bill IRS Notice 2025-57.
When: Tax years 2025 through 2028
What: Interest deduction on individual return for up to $10,000 on vehicle interest for vehicles manufactured/assembled in the United States.
Phase out: This is phased out for taxpayers with adjusted gross income over $100,000 ($200,000 on joint return).
Specifics:
- Must be passenger vehicles with original use commencing with the taxpayer. Does not apply to used and leased vehicles.
- Must be a car, minivan, van, SUV, pickup truck or motorcycle.
- Must have a gross vehicle weight under 14,000 pounds.
Forms:
- 2025: The lender can provide any proof of the interest including a monthly or annual statement.
- 2026 – 2028: The lender must provide a Form 1098-VLI to the owner for use on the tax return.
Other: This is a “below the line” deduction available to any individual, subject to the above adjusted gross income limitations.
VIN Number: Vehicles starting with a 1, 4 or 5 were assembled in the USA.
