New Tax Benefit

2025 to 2028 Auto Loan Interest Tax Deduction on New Hyundai Vehicles

Eligible buyers may be able to deduct up to $10,000 per year in auto loan interest on qualifying new Hyundai vehicles assembled in the United States for tax years 2025 through 2028.

This is a tax deduction, not a 0% interest loan, not a rebate, and not an instant discount at the time of purchase.



Taylor Hyundai is here to help you understand new tax saving opportunities that may be available when you finance a new vehicle. Based on the One Big Beautiful Bill Act signed in 2025, qualified buyers who purchase a new Hyundai assembled in the United States may be able to deduct a portion of the interest paid on their auto loan when filing federal taxes.

This benefit is designed for buyers who finance a new, personal use vehicle that meets the program requirements, including U.S. final assembly.



What Is the “No Tax on Car Loan Interest” Deduction?

This federal tax benefit may allow eligible buyers to deduct up to $10,000 per year of interest paid on a qualifying auto loan. The deduction applies to new vehicle loans initiated after December 31, 2024, and it is available for tax years 2025, 2026, 2027, and 2028.

This is not a special financing promotion or interest free loan. Instead, it is a deduction you may claim when filing your federal taxes, depending on your eligibility.



Key Details and Eligibility Requirements

Eligible Vehicles

To qualify, the vehicle must be:

  • New
  • Purchased for personal use (not primarily business use)
  • A car, SUV, or truck under 14,000 lbs
  • Assembled in the United States (final assembly must be in the U.S.)
  • Often identified by a VIN beginning with 1, 4, or 5 (always confirm on the actual vehicle)

Financing Requirement

This deduction applies only to financed purchases.

  • Financed purchase qualifies
  • Leases do not qualify
  • All cash purchases do not qualify

Deduction Amount

Eligible buyers may deduct:

  • Up to $10,000 per year of interest paid on the qualifying loan

Income Limits

The deduction begins to phase out for higher income earners:

  • $100,000+ AGI for single filers
  • $200,000+ AGI for married filing jointly

How to Claim the Deduction

To claim the deduction, buyers will use the IRS method for:

  • "Qualified passenger vehicle loan interest"

We recommend keeping your purchase and loan documents and consulting a qualified tax professional to confirm eligibility and filing details.


Why U.S. Final Assembly Matters

To qualify, the vehicle must be assembled in the United States. Final assembly can vary by model year, trim level, and production location, even within the same brand.

The best way to confirm eligibility is to check the window sticker and verify the final assembly information for the exact Hyundai you are purchasing.


Hyundai Models to Check for U.S. Assembly

Important: This list is a helpful starting point, but final assembly can change. Always confirm final assembly on the specific vehicle you are purchasing.

Qualifying Hyundai Models (U.S. Assembled)

  • Hyundai Santa Fe (SE, SEL, XRT, Limited, Calligraphy)
  • Hyundai Tucson (SE, SEL, SEL Convenience, XRT, Limited)
  • Hyundai Santa Cruz (SE, SEL, SEL Activity, XRT, Limited)
  • Hyundai IONIQ 5 (SE Standard Range, SE, SEL, XRT, Limited)
  • Hyundai IONIQ 9


Quick Checklist Before You Buy

You may qualify if:

  • You purchase a new Hyundai for personal use
  • The Hyundai is assembled in the United States
  • You finance the purchase with a qualifying auto loan
  • The loan begins after December 31, 2024
  • The vehicle is under 14,000 lbs
  • You meet the income guidelines (or are not fully phased out)

You may not qualify if:

  • You lease the vehicle
  • You pay cash and do not finance
  • The vehicle is assembled outside the U.S.
  • The purchase is primarily for business use


We Can Help You Confirm a Qualifying Hyundai

If you are shopping for a new Hyundai, our team can help you:

  • Confirm whether a specific vehicle is assembled in the U.S.
  • Walk through your purchase options
  • Provide the details you may need to share with your tax professional


Shop New Hyundai Vehicles Today

Browse new Hyundai inventory, schedule a test drive, or contact our team for help checking eligibility details on a specific vehicle.



Footer Disclaimer

Disclaimer: This page is for informational purposes only and is not tax or legal advice. Tax rules and eligibility requirements may change. Always consult a qualified tax professional regarding your specific situation.