- The new Qualified Personal Vehicle Loan Interest Deduction QPVLI has multiple eligibility requirements. This guide will help you determine if you and your vehicle qualify.
Purchase Requirments
- Vehicle financed between 2025 and 2028. Leases and outright cash purchases do not qualify
- Vehicle is over 50% personal usage. If your business use milegae of this vehicle in a specific year is over 50% of the total mileage in that year, the vehicle’s loan does not qualify
- Vehicle was purchased new. Used vehicle purchases do not qualify
If your purchase meets ALL of the above criteria, continue to the next section.
Income Requirement
For tax year 2025, your Modified Adjusted Gross Income (MAGI) must be in or below the following ranges to qualify.
Single, Married Filing Separate, and Head of Household filers.
- MAGI Below $100,000 – Full eligibility
- MAGI Between $100,000 and $150,000 – Prorated Deduction
- MAGI Above $150,000 – No Deduction
Married Filing Joint filers.
- MAGI Below $200,000 – Full eligibility
- MAGI Between $200,000 and $250,000 – Prorated Deduction
- MAGI Above $250,000 – No Deduction
Manufacturing Country Requirement
The final eligibility requirement is that the vehicle in question must have been assembled at a plant in the United States.
The IRS has not released a comprehensive list of eligible vehicles, but the simplest way to determine eligibility is to check your vehicle’s VIN.
If your VIN starts with 1, 4, or 5, it means the vehicle was assembled in the US and qualifies for the deduction.
If you have met all of the qualifications so far, you qualify for the deduction and you should gather the necessary information to report your deduction.
What to provide your CPA
- Interest Paid – For tax year 2025, there are transition exceptions in place that allow lenders to opt out of providing you with Form 1098-VLI, which would report the total interest you paid during the past year. If your lender does not send you some other type of 2025 interest summary, you will need to obtain this information from your loan bills. Your December bill may contain a year-to-date interest paid line. If it does not, you will need to provide all the 2025 bills or total the interest shown on each bill and present that to your CPA.
- VIN – Your VIN is required to be reported on your return to claim the deduction. Check your vehicle registration, insurance card, bill of sale, or the dashboard of your vehicle to find this number.
If you have any questions about this deduction, feel free to reach out
