Tax Deduction for Financing NEW U.S.-Built Motorcycles (2025–2028)
A new federal law known as the Made in America Motors Act offers a valuable tax deduction for individuals who finance the purchase of a new motorcycle assembled in the United States. Here’s a breakdown of how the program works:
💰 What’s the Tax Benefit?
If you take out a loan to buy a new U.S.-assembled motorcycle, you may be eligible to deduct up to $10,000 per year in loan interest on your federal tax return.
✔️ Which Motorcycles Qualify?
The bike must be assembled in the United States
It must be used for personal, not business or commercial, purposes
The benefit applies only to new motorcycles (not used or previously owned)
📅 When Is the Deduction Available?
This tax break is available for qualifying motorcycle loans that are issued between January 1, 2025, and December 31, 2028.
Note: It’s the loan origination date that matters—not the model year of the motorcycle. Only applies to new motorcycles that are built or assembled in the United States.
🧾 How to Claim It
This is an above-the-line deduction, meaning it reduces your adjusted gross income (AGI) whether you take the standard deduction or itemize.
You’ll report the interest paid on your loan each year.
Your lender should provide year-end documentation showing the interest amount.
📉 Income Limitations
The deduction phases out at higher income levels:
| Filing Status | Phase-Out Range (MAGI) |
|---|---|
| Single or Head of Household | $100,000 – $150,000 |
| Married Filing Jointly | $200,000 – $250,000 |
If your income falls within these ranges, you may receive only a partial deduction. If your income exceeds the upper limit, the benefit is not available.
🛠️ Example Scenario
Let’s say you buy a new American-made motorcycle in 2025 and finance it with a loan. If you pay $1,500 in interest that year and your income is below the threshold, you could deduct the full $1,500 from your taxable income—potentially reducing your tax bill.
🔍 Things to Keep in Mind
This deduction is temporary and only available through the end of 2028.
Always consult with a tax advisor or accountant to understand how this benefit applies to your personal situation.
Your loan provider should supply all necessary documentation to support your deduction.
Why It Matters
This deduction is designed to support American manufacturing and make it easier for individuals to buy motorcycles built right here in the U.S. For eligible buyers, it could mean real savings at tax time—and more horsepower in the garage.
DISCLAIMER: *This content is for informational purposes only and does not constitute tax, legal, or financial advice. Please consult a certified tax professional or financial advisor to determine how this tax deduction may apply to your personal situation.