To amend the Internal Revenue Code of 1986 to allow a deduction for loan interest payments made with respect to certain vehicles.
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Overview
This bill proposes to change the Internal Revenue Code to allow taxpayers to deduct interest paid on loans for certain vehicles. Specifically, it expands the definition of ‘qualified passenger vehicles’ to include recreational vehicles like RVs, trailers, and campers. The deduction would apply to vehicles with a gross vehicle weight rating of less than 14,000 pounds and that are treated as motor vehicles for clean air act purposes. The changes will take effect starting in 2026.
Key provisions
- Expands the definition of ‘qualified passenger vehicles’ to include recreational vehicles.
- Allows a deduction for loan interest paid on vehicles meeting specific weight and clean air act criteria.
- Includes cars, vans, SUVs, pickup trucks, motorcycles, trailers, campers, and vehicles designed for temporary living quarters.
- Vehicles must have a gross vehicle weight rating of less than 14,000 pounds.
Who is affected
- Taxpayers
- Vehicle owners
- Individuals who take out loans for vehicles
Notable changes
- Adds recreational vehicles to the list of vehicles eligible for interest deduction.
- Establishes a gross vehicle weight rating limit for eligible vehicles.
Fiscal impact
The bill may increase tax revenue due to the expanded deduction for vehicle loan interest.
Bill text
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Sponsors
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