The Internal Revenue Service Building, located in the center of the Federal Triangle complex in Washington, DC.     

By Joe Lombardi From Daily Voice

A new federal move could mean financial breathing room for thousands across the country.

The Department of the Treasury and the Internal Revenue Service announced transitional guidance for 2025, offering penalty relief to lenders and businesses adjusting to new reporting requirements under the "One, Big, Beautiful Bill."

Under the plan, companies that receive interest payments on qualified passenger vehicle loans will not face penalties. This applies if they make loan interest information available through standard channels, such as online portals or monthly statements.

The guidance aims to ease compliance as lenders adapt to a new federal rule requiring the reporting of interest received on vehicle loans. 

The relief applies to qualified vehicles — cars, vans, SUVs, and motorcycles — weighing less than 14,000 pounds and assembled in the United States.

According to the IRS, the transition period is designed to prevent unnecessary disruption while businesses integrate new reporting systems.

The One, Big, Beautiful Bill also allows individuals to deduct interest paid on eligible vehicle loans between Jan. 1, 2025, and Dec. 31, 2028, provided the loan is for personal use and meets federal qualifications.

Businesses that receive six hundred dollars or more in interest from an individual within a calendar year must comply with the new reporting standards.

The move is part of a broader effort to modernize tax reporting and simplify compliance for both lenders and consumers.

For more information, visit the IRS website here.