Car Loan Interest Deduction Calculator (2026)

New for 2026: deduct up to $10,000 of interest on a loan for a new, US-assembled vehicle. Estimate your deductible interest and tax savings. ✓ 2026 IRS figures

🚗

Car Loan Interest Deduction

2026 deduction • Tax savings

$
%
yrs
$
🚗
Enter your loan to see your deduction

How the Car Loan Interest Deduction Works

  1. Enter your loan amount, APR and term (or your interest directly).
  2. Add your income, status and bracket.
  3. See your deductible interest (max $10,000/yr) and the tax it saves.

Car Loan Interest Deduction, Explained (2026)

For loans taken 2025–2028 on a new, US-assembled vehicle for personal use, the One Big Beautiful Bill lets you deduct up to $10,000 of loan interest per year — even if you take the standard deduction. It phases out above $100,000 modified AGI ($200,000 joint), reduced by $200 per $1,000 over.

Interest is highest in the early years of a loan, so this deduction is most valuable up front. Your savings equal the deductible interest times your tax bracket. Used cars, leases and business vehicles don't qualify. This is an estimate, not tax advice.

Car Loan Interest Deduction FAQ

New (not used) cars, trucks, SUVs, vans or motorcycles with final assembly in the United States, purchased 2025–2028 for personal use and financed with a secured loan.
Up to $10,000 of interest per year, phasing out above $100,000 income ($200,000 joint). You can claim it without itemizing.
No. Only purchase loans on qualifying new vehicles qualify — leases and used-car loans are excluded.

Related Calculators

🚙
Auto Loan
Open →
💰
OBBBA Tax Savings
Open →
💲
Car Affordability
Open →
✔ Reviewed by the True Value Calc editorial team🗓 Last updated June 2026📚 Sources: Freddie Mac PMMS, Consumer Financial Protection Bureau