Uncle Sam wants you to buy a car

NEW YORK (CNNMoney.com) — With auto sales at crisis levels, Washington is trying to figure out how to get Americans buying cars again.

Several ideas are on the table, but two of them are really making the industry pay attention. One plan is to make new car costs tax deductible. The other is to give rebates to Americans with old cars so they can better afford to buy new ones, a program otherwise known as “cash for clunkers.”


It would be an “above the line” deduction, meaning even tax filers who don’t itemize deductions could still get the benefit, according to the bill introduced by Sen. Barbara Mikulski, D-Md., and Rep. Bill Pascrell, D.-N.J.

Auto loans of up to $49,500 would qualify. Car buyers borrowing more would still be able to deduct the interest and sales tax for the first $49,500. The benefit wouldn’t apply to individuals making more than $150,000 or families making more than $250,000.

CNN