Which Cars Qualify for the Car Loan Interest Deduction?
The rule is simple. The car must have been assembled in the United States. Here is how to check yours in 30 seconds.
The new tax law lets you deduct up to $10,000 of car loan interest per year from 2025 through 2028. But there is a catch that surprises most buyers. The vehicle must have had its final assembly in the US. The brand does not matter. The plant does.
The fastest way to check: your VIN
Every car has a 17 character VIN. It is on your dashboard, your door jamb, and your registration. Our free VIN checker looks it up in the official government database and tells you the assembly plant instantly.
A quick shortcut: look at the first character of your VIN. A 1, 4, or 5 usually means built in the US. A J means Japan. A K means Korea. A W means Germany. A 3 means Mexico. The VIN checker confirms it for certain.
Popular models usually assembled in the US
This list covers common 2025 and newer models that are typically built in American plants. Always confirm with your own VIN, because some models are built in more than one country.
| Model | Typical US plant |
|---|---|
| Tesla Model 3, Y, S, X | California and Texas |
| Ford F-150 | Michigan and Missouri |
| Toyota Camry | Kentucky |
| Honda Accord | Ohio |
| Jeep Grand Cherokee | Michigan |
| Subaru Outback and Ascent | Indiana |
| BMW X3, X4, X5, X6, X7 | South Carolina |
| Mercedes GLE and GLS | Alabama |
| Hyundai Santa Fe | Alabama |
| Kia Telluride | Georgia |
| VW Atlas and ID.4 | Tennessee |
| Nissan Altima | Tennessee |
Note the surprises here. Many BMW, Mercedes, Hyundai, and Kia models qualify because they are built in the American South. Meanwhile some Ford, Chevy, and Jeep models do not qualify because they are built in Mexico or Canada. Never assume from the badge. Check the VIN.
The other four rules
US assembly is one of five tests. The car must also be new, not used. You must have bought it after December 31, 2024. It must be for personal use. And the loan must be secured by the car itself. Lease payments do not count.
How much is it worth?
A typical $40,000 loan at 7% costs about $2,700 in interest the first year. In the 22% bracket that deduction saves about $594. Run your own numbers with our car loan deduction calculator. It includes the free VIN check.