Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?

bartlettpc — Thu, 05 Feb 2026 11:48:54 GMT

Re: Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?

MinhT1 — Thu, 05 Feb 2026 12:25:51 GMT

The OBBBA has introduced a new deduction for car loan interest paid for new cars you bought for personal use between 2025 and 2028.

The deduction is up to $10,000 if your income is under $100,000 (or $200,000 if MFJ). The deduction is gradually phased for higher incomes.

For the requirements of this deduction, please read this TurboTax Help article.

In TurboTax Online, you can enter your car loan deduction by following these steps:

Open your tax return
Click on Federal in the left-hand column, then on Deductions & Credits
Navigate to the list of Deductions and Credits
Click on Other Deductible expenses
Locate the section Cars and Other Things You Own and click on the arrow on the right
Click Start next to Car Loan Interest
Follow the TurboTax questionnaire to enter your car loan interest
The deduction will transfer to Schedule 1-A of your form 1040, which is then transferred together with other deductions such as the additional senior deduction, to line 13b of your form 1040.

Re: Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?

Opus 17 — Thu, 05 Feb 2026 13:32:44 GMT

Interest is only deductible if final assembly of the vehicle was in the US. That information is encoded in the VIN and it is on a placard attached to the driver's door frame. See here for more.

https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions-individuals-and-workers

topic Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry? in Deductions & credits

Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?

Re: Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?

Re: Bought a new car in 2025. How do we deduct interest payments on our 2025 Toyota Camry?