This bill expands the federal tax deduction for vehicle loan interest payments to include certain recreational vehicles, campers, and trailers for loans taken out after December 31, 2025.
Todd Young
Senator
IN
This bill amends the Internal Revenue Code to expand the federal deduction for interest paid on certain vehicle loans. Specifically, it adds recreational vehicles, campers, and trailers to the list of qualifying vehicles. This change will apply only to loans taken out after December 31, 2025.
Proposed Tax Change Adds RVs and Campers to Interest Deduction List Starting in 2026
This bill aims to put more money back in the pockets of outdoor enthusiasts by expanding the federal tax deduction for vehicle loan interest. Currently, the IRS lets you deduct interest on standard rides like cars, SUVs, and motorcycles. This legislation proposes to widen that circle to include recreational vehicles, campers, and trailers, effectively treating your home-on-wheels more like your daily driver when tax season rolls around. To qualify, the vehicle must be designed for temporary living quarters—think seasonal camping or road trips—and either have its own engine or be towable by a standard truck or car.
The Great Outdoors Discount
Starting January 1, 2026, this change would apply to any new loans taken out for these specific recreational assets. If you’re a family looking to finance a pop-up camper for summer trips or a retiree eyeing a motorhome for cross-country travel, the interest you pay on that loan could become a deductible expense. Under the new definition, the bill maintains a 14,000-pound weight limit for standard motor vehicles like pickups and SUVs, but specifically carves out space for trailers and campers designed for 'recreational, camping, or seasonal use.' It’s a straightforward shift that acknowledges how many Americans spend their leisure time and money.
Financing the Nomadic Lifestyle
For the average person, this isn't just about a niche hobby; it’s a potential shift in the math of ownership. Because RVs and high-end trailers often come with long-term financing and significant interest costs, being able to deduct that interest could lower the total cost of ownership over the life of the loan. For example, a worker who buys a towable trailer in 2026 to use for weekend getaways would be able to count those interest payments toward their tax deductions, provided the trailer meets the bill's criteria for temporary living quarters. The bill is quite specific: it only applies to loans originated after December 31, 2025, so anyone who already has an RV in the driveway won't see a retroactive benefit on their current monthly payments.