Car Interest Deduction

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I already filed my taxes.(Unfortunately, my car loan statement just now came in the mail). I didn’t think it qualified because it wasn’t an American car. So, is there any to check, if the car deduction would have made any difference “before” trying to amend the tax return???

Vanessa A

Alumni - Intuit

Yes. You should check, especially if you did not get all of your withholdings back. If the car is not an American car, as long as the final assembly was in the US, it can still qualify. Look at your VIN. If it starts with a 1, 4, or 5, it was assembled in the U.S. and likely qualifies. You can also use a VIN decoder to figure out where your vehicles final assembly occurred.

IF, you already got all of what you paid in back as part of your refund, it may not make a difference. This is an above the line deduction, not a credit meaning it will lower your AGI and taxable income. It will not be an amount that is refunded to you, but it could result in a refund by lowering your taxable income.

To qualify for the vehicle interest deduction the following must apply:

The car was purchased not leased
Final assembly occurred in the US
It is NOT a business use, but was purchased for personal use
It has a GVWR of less than 14,000lbs (car, truck, SUV, mini van or motorcycle)
Loan was originated in 2025 and must be secured by a lien on the vehicle or the title
Your income must be less than $100,000 if single or $200,000 if married filing jointly to receive the full deduction.
If your income is over $150,000 if single or $250,000 if Married filing jointly, you are not eligible

Note: The interest deduction is capped at $10,000. This is an above the line deduction, not a credit meaning it will lower your AGI and taxable income. It will not be an amount that is refunded to you, but it could result in a refund by lowering your taxable income.

Yes. You can enter your car loan interest by selecting the following:

Deductions and credits
Cars and Other things you own
Start next to Car Loan Interest
You will need to enter the VIN and information from the lender

You can also do a scenario in TurboTax to see if it makes a difference. Just be sure that if you used TurboTax online that you delete it, even if it will make a difference as you will then need to amend your return.

If you are using the desktop version, you can close out without saving and this will go back to the previous forms.

Follow the instructions here to amend your return. Amended forms are not available until sometime after mid February.

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