$10K car loan deduction

Thinking about buying a new car?

There’s a new tax break that’s been making headlines.

It lets you deduct up to $10,000 in car loan interest each year, from 2025 through 2028.

Sounds huge, right?

Well… let’s slow down a bit.

Here’s the fine print:

1. The car has to be brand new and assembled in the U.S. (that rules out imports and many models lower-income families usually buy)

2. It’s for personal use only. No work trucks or company vehicles.

3. If you’re single, your income needs to be under $100,000 to get the full deduction or under $200,000 if you’re married.

4. And you can claim it even if you don’t itemize deductions.

So what’s the catch?

Even with that $10K cap, most people will only save a few hundred dollars a year.

And with car prices going up because of tariffs, those savings can vanish before you’ve even left the lot.

If you’re shopping for a car, or just wondering if this deduction is worth it for you,

Call me at (702)325-4276 

And we’ll run the numbers together.

That’s all for today!

Talk soon,

Kat Ching, Enrolled Agent

P.S. Check this out 👇