Tax law changes: Cybertruck loan interest deductible?

[TeslaKen]

I was reading an article about tax law changes and it said interest on loans up to $10k annually were deductible on US made vehicles with loans originating in 2024 forward. It sounds like that would apply to Cybertruck owners that financed their trucks. Does anyone know for certain?

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[NX-01Cybertruck]

Pretty sure its for loans originating in 2025(Dec 31,2024) it does apply to cybertruck.

 

[TeslaKen]

Pretty sure its for loans originating in 2025(Dec 31,2024) it does apply to cybertruck.

What if you took the loan out in May 2024 and then refinanced it in May 2025? Seems like the refinanced loan should apply shouldn't it? Just curious if I need to be passing some info to my tax guy.

 

[mongo]

What if you took the loan out in May 2024 and then refinanced it in May 2025? Seems like the refinanced loan should apply shouldn't it? Just curious if I need to be passing some info to my tax guy.

The new loan wasn't to purchase a new vehicle...
https://www.irs.gov/newsroom/treasu...oan-interest-under-the-one-big-beautiful-bill

 

[Gaximus]

I was reading an article about tax law changes and it said interest on loans up to $10k annually were deductible on US made vehicles with loans originating in 2024 forward. It sounds like that would apply to Cybertruck owners that financed their trucks. Does anyone know for certain?

Interest up to $10k? loan up to $10k? $10k deducted annually? or can be deducted annually?

 

[mongo]

Interest up to $10k? loan up to $10k? $10k deducted annually? or can be deducted annually?

Based on quick skim:
Look like $10k max per tax return. Married filing separately could take $20k.
Didn't see a lifetime limit in my short scan.

 

[TeslaKen]

The new loan wasn't to purchase a new vehicle...
https://www.irs.gov/newsroom/treasu...oan-interest-under-the-one-big-beautiful-bill

New loan to buy an old loan for a new car seems legit to me... at a minimum why wouldn't you get to deduct the interest from 2025 forward on existing loans? You've bought an American made vehicle and you are paying it off with a loan, sure if you are in year 5 of a 5 year loan then you only get the tax deduction for 1 year, but I don't see why people who took out loans before this offer started should get penalized down to $0 deduction when they have done what the act is set out to do and that is buy an American made car and finance it.

Speaking of which, I see little incentive for banks to be competitive on car loan rates now as they will just tell you to deduct all the interest so what does it matter how much interest you are paying...

 

[Gaximus]

Based on quick skim:
Look like $10k max per tax return. Married filing separately could take $20k.
Didn't see a lifetime limit in my short scan.

But is it the loan is 10k, or the interest 10k, or the amount paid toward the loan?

 

[mongo]

But is it the loan is 10k, or the interest 10k, or the amount paid toward the loan?

The interest

 

[mongo]

New loan to buy an old loan for a new car seems legit to me... at a minimum why wouldn't you get to deduct the interest from 2025 forward on existing loans? You've bought an American made vehicle and you are paying it off with a loan, sure if you are in year 5 of a 5 year loan then you only get the tax deduction for 1 year, but I don't see why people who took out loans before this offer started should get penalized down to $0 deduction when they have done what the act is set out to do and that is buy an American made car and finance it.

Speaking of which, I see little incentive for banks to be competitive on car loan rates now as they will just tell you to deduct all the interest so what does it matter how much interest you are paying...

It's to incentivise buying a new car, not to help with previous purchases.

My link above leads to the legalese, I may be mistaken.

(d)
Specified passenger vehicle loan (SPVL)
—(1)
In general.

Indebtedness is an SPVL only if the indebtedness is incurred by the taxpayer after December 31, 2024, for the purchase of an APV for personal use, and is secured by a first lien on that APV.

 

[Beetlebug62]

I was reading an article about tax law changes and it said interest on loans up to $10k annually were deductible on US made vehicles with loans originating in 2024 forward. It sounds like that would apply to Cybertruck owners that financed their trucks. Does anyone know for certain?

Yeah, from the BBB, big beautiful bill. No one has $10k in loan interest. Mine is about $800 for 2025, so will be worth about $200 in actual tax reduction.

On the good side, you don't have to itemize to take the deduction.

 

[mongo]

Yeah, from the BBB, big beautiful bill. No one has $10k in loan interest. Mine is about $800 for 2025, so will be worth about $200 in actual tax reduction.

On the good side, you don't have to itemize to take the deduction.

Over $6k in interest last year for Cyberbeast. Would have been more if purchased in 2025.
Now they are offering 3.99% ... and free supercharging ...

 

[damageprone]

I think most of us who bought a CT would not be qualified under this stipulation:

Income phase-out: The deduction phases out for taxpayers with modified adjusted gross income (MAGI) over $100,000 (single) or $200,000 (joint filers).

 

[cyberrr1]

I think most of us who bought a CT would not be qualified under this stipulation:

Income phase-out: The deduction phases out for taxpayers with modified adjusted gross income (MAGI) over $100,000 (single) or $200,000 (joint filers).

That income cap is insanely low...Most of the top wealthiest American billionaires would qualify, they all have annual incomes under $100k...they're mostly compensated with stock.

 

[bg002h]

That income cap is insanely low...Most of the top wealthiest American billionaires would qualify, they all have annual incomes under $100k...they're mostly compensated with stock.

Tax breaks never apply to working people with high incomes. Just rich people who don’t work or poor people. Working is the worst way to make money.

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