Buying a car might soon come with more than just a new ride and another line on your monthly budget. If a new tax proposal currently under consideration in Washington moves forward, some car buyers could see a surprising bonus in the form of a potential break on their federal income taxes.
A provision in the Senate GOP’s latest tax plan, which could reach President Trump’s desk as soon as July 4, would allow certain new car buyers to deduct up to $10,000 in auto loan interest from their taxable income. The deduction would be available from 2025 through 2028, giving eligible buyers a multi-year incentive, at least on paper. But don’t assume everyone with a car loan is in line for a break.
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