Is Car Loan Interest Tax Deductible?

Yes, as of the 2025 tax year, interest on a new car purchase loan may be a tax write-off.
Aaron Turpen
Posted by December 18, 2025

Yes, as of the 2025 tax year, interest on a new car purchase loan may be a tax write-off.

Official IRS guidance on this: https://www.irs.gov/newsroom/one-big-beautiful-bill-act-tax-deductions-for-working-americans-and-seniors

Aaron Turpen
Aaron Turpen
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An automotive enthusiast for most of his adult life, Aaron has worked in and around the industry in many ways. He is an accredited member of the Rocky Mountain Automotive Press (RMAP) and freelances as a writer and journalist around the Web and in print. You can find his portfolio at AaronOnAutos.com.