Some car buyers will get a tax break this year from the "big, beautiful bill." Here's how it works.

Millions of car buyers in the U.S. could soon get some tax relief thanks to a provision in the so-called "big, beautiful bill" that was signed into law on July 4 by President Trump. 

The idea of giving a tax break for auto purchasers was first floated by Mr. Trump while on the campaign trail in October, when he promised that such a measure would "make car ownership dramatically more affordable for millions and millions of working American families."

That promise has now materialized as part of the One Big Beautiful Bill Act, with the new tax break taking effect for car purchases starting in 2025. But the deduction also has income limitations that narrow the number of Americans who can claim it, while used car buyers and vehicle leasers do not benefit.