H.R. 3450 — To amend the Internal Revenue Code of 1986 to provide for special rules allowing taxpayers to deduct qualified passenger vehicle loan interest paid or accrued during the taxable year on certain indebtedness, and for other purposes.

This section establishes, for tax years 2025 through 2028, an above-the-line deduction under IRC §163(h)(4) and §62(a)(22) for qualified passenger vehicle loan interest paid or accrued on indebtedness incurred after December 31, 2024, secured by a first lien on a U.S.-assembled applicable passenger vehicle (i.e., car, minivan, SUV, pickup, motorcycle, ATV, or recreational trailer/camper) purchased for personal use. The deduction is limited to $10,000 per year and phases out by $200 for each $1,000 of modified adjusted gross income over $100,000 ($200,000 joint), with exceptions excluding fleet sales, refinancings exceeding original principal, related-party loans, leases, salvage vehicles, and commercial/non-personal uses. (Thus, it temporarily restores deductibility of such auto loan interest, previously nondeductible as personal interest since 1986.) This section also requires lenders receiving $600 or more in such interest annually to report borrower details (e.g., interest paid, outstanding principal, loan origination, vehicle year/make/model) to the IRS and taxpayer under new IRC §6050AA.