This bill would let people lower their taxable income by deducting the interest they pay on certain car loans. To qualify, the car must be assembled in the United States, and the loan must be a standard car loan that is secured by the car itself.

The deduction only applies to interest on new loans taken out on or after January 1, 2025, and only if the loan was used to buy a qualifying car with final assembly in the U.S..

Key points

• Who is affected: People who finance a car that was assembled in the U.S. and use the car as collateral for the loan.
• What changes: Interest paid on that car loan can be deducted to reduce taxable income.
• When: Applies to interest on loans taken out on or after January 1, 2025.