In Episode 154 of the Teaching Tax Flow podcast, hosts Chris Picciurro, CPA, and John Tripolsky rev up a discussion on one of the most surprising new provisions from the One Big Beautiful Bill Act (OB3): a personal tax deduction for qualified automobile loan interest.

Chris and John break down how this above-the-line deduction works, the criteria for qualifying, and the potential pitfalls for taxpayers. From vehicle requirements to phased-out income thresholds, they explain how this law is designed to incentivize specific behaviors and how taxpayers can maximize the benefit.

The episode also includes case studies and examples showing how taxpayers in different income brackets may be affected, emphasizing the importance of marginal tax rate planning to understand the real financial impact.

What You’ll Learn:

• The specifics of the new automobile loan interest deduction under OB3

• Requirements for eligibility (new vehicle, U.S.-assembled, secured loan)

• How phase-outs at $100K (single) and $200K (married filing jointly) affect deductions

• Practical examples of how different taxpayers qualify—or don’t

• Why your marginal tax rate (MTR) is a critical metric for evaluating tax strategies

Key Insights:

This new provision could provide meaningful savings for qualifying taxpayers, but the rules are nuanced. Proper planning ensures you avoid phase-out surprises and maximize deductions where possible.

Notable Quotes:

• “Tax laws are written to encourage and discourage certain behaviors.” – Chris Picciurro

• “Now there’s a deduction on a personal tax return for qualified automobile loan interest.” – Chris Picciurro

• “For every thousand you’re over, you lose a deduction of $200.” – Chris Picciurro

• “Your number one KPI in tax planning is your marginal tax rate, not your tax bracket.” – Chris Picciurro

• “If you’re over $100,000 in income, you start getting phased out of this deduction.” – Chris Picciurro

Resources:

• Episode Sponsor: Wealth Builders Mortgage Group

• Teaching Tax Flow YouTube Channel

• Defeating Taxes Community

• (00:00) - Summary
• (00:00) - Exploring New Automobile Interest Deductions with Teaching Tax Flow
• (02:20) - New Tax Deduction for Qualified Automobile Loan Interest
• (09:29) - Understanding Tax Phase Outs and Their Impact on Deductions
• (15:41) - Understanding Vehicle Loan Interest Deductions and Tax Implications
• (21:12) - Exploring Tax Topics and Investment Advice on Teaching Taxable