Yes, the system will be updated to reflect the changes with the One Big Beautiful Bill Act, and no, you will not need to upgrade to get the overtime tax break. The new provision for overtime introduces a deduction for qualified overtime income up to $12,500 for tax years 2025 through 2028 and phases out for income above $150,000.
While this deduction can lower your taxable income, it is not a dollar-for-dollar reduction of your taxes and the actual tax savings will depend on your tax rate.
Here are the qualifications for the car loan interest deduction, below.
Overview of the new deduction
- Effective 2025 through 2028, individuals may deduct interest paid on a loan used to purchase a qualified vehicle for personal use that meets other eligibility criteria. Lease payments do not qualify.
- Maximum annual deduction is $10,000.
- Phases out for taxpayers with modified adjusted gross income over $100,000 ($200,000 for joint filers).
What counts as qualified interest
Interest must be paid on a loan that:
- Originated after December 31, 2024
- Was used to purchase a vehicle originally used by the taxpayer
- Was secured by a lien on the vehicle
- Was for a personal-use (nonbusiness) vehicle
If a qualifying vehicle loan is later refinanced, interest paid on the refinanced amount is generally eligible for the deduction.
For more details on the OBBBA, please click here.
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