'Big, beautiful, bill' car loan interest tax deduction

• Trump's tax cut and spending package includes a deduction of up to $10,000 for interest paid on the car loans.
• To qualify for the tax deductions, vehicles must meet several conditions, including final assembly in the U.S.
• More than 100 vehicles currently qualify for the U.S. final assembly condition.
• https://www.cars.com/american-made-index/

Specific limitations significantly restrict who can benefit from the new deduction:

• Purchase Date: The vehicle must have been bought on or after Jan. 1.
• U.S. Assembly: The car must be for personal use and assembled in the United States. For such vehicles, the VIN starts with 1, 4, or 5.
• Income Thresholds: The deduction starts to phase out at a modified adjusted gross income of $100,000 for single filers and $200,000 for joint filers. A deduction is not available for single filers with a MAGI over $149,000 or joint filers with a MAGI over $249,000.

• Additionally, the loan on the vehicle must be a standard and secured auto loan. Refinanced loans may also qualify under certain conditions. The car's vehicle identification number (VIN) must also be reported on tax returns in order to qualify. Deductions do not need to be itemized, according to the new law.

more at https://finance.yahoo.com/news/one-big-beautiful-bill-promises-165300543.html

WASHINGTON - President Donald Trump's "big, beautiful bill" was signed into law earlier this month touting several tax deductions, including of up to $10,000 for interest paid on the car loans of qualified vehicles.

However, both the vehicles and the loans must satisfy a number of conditions in order to qualify.

What we know:

The new law states that qualified vehicles include cars, vans, minivans, SUVs, pickup trucks and motorcycles that weigh less than 14,000 pounds that have at least two wheels, and are purchased new, not used, between 2025 and 2028 for personal use.

The final assembly of the vehicle must also take place in the United States, which currently includes over 100 brands and models, according to Cars.com.

Vehicles assembled in the US

• Acura: Integra, MDX, RDX, TLX, ZDX
• BMW: X3, X4/X4 M, X5, X6, X7, XM, X% PHEV
• Cadillac: CT4, CT5, CT5-V, Escalade, Escalade ESV, Lyriq, XT4, XT5, XT6
• Chevrolet: Colorado, Corvette, Silverado, Silverado HD, Suburban, Tahoe, Traverse, Blazer, Malibu, Trax
• Ford: Mustang, Bronco, Escape, Explorer, F-150, F-150 Lightning, F-150 Huybrid, F-250/350, Transit, Ranger, Expedition, Expedition Max
• GMC: Acadia, Canyon, Hummer EV, Sierra, Sierra HD, SIerra 1500, Yukon, Yukon XL
• Honda: Accord, Accord Hybrid, Civic, Civic Hybrid, CR-V, CR-V Hybrid, Odyssey, Passport, Ridgeline, Pilot
• Hyundai: Santa Fe, Santa Fe HEV, Tucson, Ioniq 5, Santa Cruz
• Jeep: Wrangler, Wrangler 4xe, Gladiator, Wagoneer, Wagoneer L, Grand Wagoneer, Grnad Wagoneer L, Grand Cherokee, Grand Cherokee 4xe, Grand Cherokee L
• Kia: Telluride, EV6, EV9, Sportage, Sorento
• Lincoln: Aviator, Corsair, Navigator, Navigator L
• Mercedes-Benz: GLE 450e, GLS 450, EQE 350+, GLE 350, GLS 580, AMG GLS 63, Maybach GLS 600, EQE 500, AMG EQE, GLE 580, AMG GLE 63,
• Tesla: Model 3, Model Y, Cybertruck, Model S, Model X
• Toyota: Camry, Corolla Cross Hybrid, Grand Highlander, Highlander, Sienna, Tundra, Highlander Hybrid, Tundra Hybrid, Sequoia, Grand Highland Hybrid, Corolla Cross, Corolla, RAV4 Hybrid, Coroll Hatchback
• Volkswagen: ID.4, Atlas, Atlas Cross Sport

The IRS is expected to create a resource listing qualifying vehicles and models, similar to existing resources for electric vehicle tax credits, to clarify which vehicles meet the final assembly requirement.

How to verify final assembly 

You can likely verify a vehicle's eligibility for the temporary income tax deduction through documentation or certifications provided by your car dealer.

Dig deeper:

Final assembly isn't the final condition for qualifying vehicles. 

The loan on the vehicle must also be a standard and secured auto loan. However, refinanced loans may also qualify under certain conditions.

The car's vehicle identification number must also be reported on tax returns.

An income cap will also be enforced. The $10,000 deduction will be reduced by $200 for every $1,000 over the limit: those filing taxes as a single person who makes more than $100,000 a year, or those filing jointly and making more than $200,000.