2025 Qualified Car Loan Interest Deduction Calculator

Estimate the Schedule 1-A deduction for interest paid on an entered qualified passenger-vehicle loan, subject to the $10,000 cap and MAGI phaseout.

Tax year supported: 2025 only. Reviewed: August 3, 2026.

Eligibility is not automatic. The calculator cannot verify the vehicle's final assembly, original use, weight rating, personal use, lien, loan origination, VIN reporting, or other return requirements.

2025 Passenger-Vehicle Loan-Interest Deduction

Estimates the Schedule 1-A deduction for qualified interest paid on a loan for an eligible new, U.S.-assembled passenger vehicle. Used vehicles, leases, and unsecured loans do not qualify.

Filing status

Modified adjusted gross income

Use the 2025 Schedule 1-A, Part I modified-AGI amount, not taxable income.

Qualified personal-use loan interest paid in 2025

Exclude interest already deductible on Schedule C, E, or F and any interest allocable to business use.

Required loan and vehicle confirmations

The loan was incurred after December 31, 2024, to purchase the vehicle and is secured by a first lien on it.The vehicle was new and its original use began with the taxpayer claiming the deduction.It is a car, minivan, van, sport utility vehicle, pickup truck, or motorcycle with a gross vehicle weight rating below 14,000 pounds.The vehicle was purchased for personal use. The amount entered excludes any business-use portion.The vehicle's final assembly occurred in the United States.The taxpayer has the vehicle identification number (VIN) and will include it on the tax return.

How the 2025 estimate works

The tool limits entered qualified interest to $10,000 and then applies the MAGI phaseout for the selected filing status. A used vehicle, a vehicle assembled outside the United States, a loan not secured by a first lien, or a vehicle with a gross vehicle weight rating of 14,000 pounds or more does not satisfy the listed rules.

Frequently asked questions

What vehicle and loan requirements apply for 2025?

The vehicle must be new, its original use must begin with the taxpayer, it must be for personal use, its final assembly must occur in the United States, and its gross vehicle weight rating must be under 14,000 pounds. The purchase loan must originate after December 31, 2024, and be secured by a first lien on the vehicle.

What is the 2025 car loan interest deduction limit?

The deduction is limited to $10,000 before the MAGI phaseout. The phaseout begins at $100,000 of MAGI, or $200,000 for a joint return. Married filing separately is not eligible.

Do I have to itemize this car loan interest?

No. If the vehicle, loan, taxpayer, and reporting requirements are satisfied, the deduction is claimed on Schedule 1-A after AGI and may be available with either the standard deduction or itemized deductions.