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Finance a new, American-assembled Honda and you may qualify for an above-the-line federal tax deduction on your auto loan interest — no itemizing required.
One Big Beautiful Bill Act · Public Law 119-21 · Tax Years 2025–2028
What Is the Auto Loan Interest Deduction?
The One Big Beautiful Bill Act (Public Law 119-21), signed July 4, 2025, created a new above-the-line deduction for auto loan interest. If you finance a qualifying new vehicle, you may be able to deduct up to $10,000 per year in loan interest directly on your federal tax return — even if you take the standard deduction. The deduction is available for tax years 2025 through 2028.
This is one of the most meaningful new car tax deductions in years. Many of the Honda models we carry at Serra Honda O'Fallon are assembled right here in the United States — which means many of our buyers may be eligible.
Do You Qualify?
The federal auto loan interest deduction has clear eligibility requirements. Every one of the following conditions must apply to your purchase.
You must be the first registered owner. Used vehicles do not qualify for this deduction under any circumstance.
Must be a traditional auto loan secured by the vehicle. Cash purchases and vehicle leases do not qualify.
The vehicle must be used for personal, non-commercial purposes. Business-use or commercial vehicles are excluded.
The vehicle's gross vehicle weight rating must be under 14,000 pounds. Most passenger cars and light trucks qualify.
The vehicle's final assembly must have taken place in the United States, confirmed by VIN or window sticker.
The auto loan must have originated after December 31, 2024. Loans originated before that date are not eligible.
The deduction begins to phase out above $100,000 AGI for single filers and $200,000 AGI for joint filers. Most middle-income buyers will fall within the qualifying window. Always consult a qualified tax professional to confirm your specific eligibility.
Qualifying Vehicles at Serra Honda O'Fallon
Many of Honda's most popular models are built in American plants and may qualify for the federal auto loan interest deduction. Assembly location can vary by trim level and production run. We verify assembly location on every vehicle using the VIN or window sticker at point of sale.
| Model | Assembly Location | Verification |
|---|---|---|
| Accord / Accord Hybrid | Marysville, OH | — |
| Civic (select trims) | Greensburg, IN | Verify by VIN |
| CR-V / CR-V Hybrid | East Liberty, OH / Greensburg, IN | Verify by VIN |
| Pilot | Lincoln, AL | — |
| Passport | Lincoln, AL | — |
| Ridgeline | Lincoln, AL | — |
| Odyssey | Lincoln, AL | — |
Important: Models not assembled in the U.S. — including the Hr-V, Prologue (Mexico), and some Civic trims assembled in Canada or Japan — would not qualify for this deduction. Assembly location is always verified by VIN at the point of sale. You can check any vehicle independently at nhtsa.gov/vin-decoder.
Common Questions
Browse our in-stock, American-assembled vehicles and talk to our finance team about how this deduction may benefit you.
Disclaimer: Serra Honda O'Fallon does not provide tax, legal, or financial advice. The information on this page is for general informational purposes only and is based on publicly available information regarding the One Big Beautiful Bill Act (Public Law 119-21). Vehicle assembly locations are subject to change and must be verified by VIN for each specific vehicle. Income limits, filing status, and other individual factors may affect your ability to claim this deduction. Please consult a qualified tax professional or CPA for guidance specific to your situation. Serra Honda O'Fallon makes no guarantee of eligibility or tax savings.
