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Car loan interest deduction calculator

Estimate how much of your 2025–2028 car loan interest you can deduct, and roughly what it saves you in federal tax.

Your lender reports this on Form 1098-VLI, or on a year-end statement.
For most people this is the adjusted gross income on Form 1040.
Check your VIN if you're not sure.
Estimated deduction
$0
Saves about $0 in federal tax
Interest paid
$0
Counted (up to $10,000)
$0
Income phase-out
$0
Estimated federal tax saved
$0

How the calculation works

  1. Cap. Only the first $10,000 of qualifying interest per tax return counts.
  2. Phase-out. If your MAGI is above $100,000 ($200,000 if married filing jointly), the deduction drops by $200 for every $1,000, or part of $1,000, over that line. With the full $10,000 of interest, the deduction is gone once MAGI passes $149,000 ($249,000 joint). Single, head of household, qualifying surviving spouse and married-filing-separately filers all use $100,000.
  3. Tax saved. The deduction lowers taxable income, so the saving is roughly the deduction times your top federal bracket. State taxes may differ.

You can take this deduction whether you itemize or take the standard deduction. You'll need to report the vehicle's VIN on your return.

This is an estimate, not tax advice. Rules last reviewed 2026-10-17. See the full rules.