Car Loan Interest Deduction

Claim up to $10,000 a Year

If you purchased a new Ford this year, you may be able to claim a temporary tax deduction on the interest paid toward your vehicle loan!

What is car loan interest deduction?

Eligible borrowers can deduct up to $10,000 in interest paid annually on qualifying loans from their taxable income.

What vehicles and loans can you deduct?

  • New car, minivan, van, SUV, or pick-up truck with a gross vehicle weight rating of less than 14,000 pounds purchased (not leased) on or after January 1, 2025.
  • Vehicles assembled in the U.S.
  • Vehicles purchased for personal use. Commercial or business vehicles are excluded.
  • The loan must be through a dealer, bank, or credit union.

Who qualifies for the exemption?

  • Individual filers with Modified Adjusted Gross Income (MAGI) of $100,000 or less and married couples filing jointly with a MAGI of $200,000 or less qualify for the full deduction.
  • The auto loan deduction reduces for people with MAGIs over those thresholds by $200 for each $1,000 in income over those levels. 
  • The deduction is not available for single filers earning more than $150,000 and married couples with incomes above $250,000.

Other stipulations and qualifications may apply. We encourage you to consult your accountant or other tax professional to verify your eligibility and all additional details. Unsure where a vehicle was assembled? Use the NHTSA VIN Decoder.

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Although every reasonable effort has been made to ensure the accuracy of the information contained in this site, absolute accuracy cannot be guaranteed. This site, and all information and materials appearing on it, are presented to the user "as is" without warranty of any kind, either express or implied. Confirm all information with your tax professional and reference the IRS website for complete information.