U.S. · Tax forms
Form 1041 line 10, interest.
Which interest goes on line 10, what is personal interest, and the new vehicle loan interest rules.
Line 10 (“Interest. Check if Form 4952 is attached”) takes investment interest (subject to limits), qualified residence interest and certain estate tax interest. Business interest goes on Schedule C, E or F instead, and personal interest is not deductible.
Look up an interest type
Result
Interest on line 10, 2025 instructions
| Interest type | Meaning | What the IRS says |
|---|---|---|
| Investment interest | Line 10, subject to limits | Use Form 4952; if you must complete it, check the box on line 10 and attach it, then add the deductible investment interest to other interest |
| Qualified residence interest | Line 10 | Interest on debt secured by a beneficiary’s qualified residence if the beneficiary has a present interest or an interest in the residuary |
| Section 6601 estate tax interest | Line 10 | Interest on any unpaid portion of the estate tax attributable to a reversionary or remainder interest, during an extension period |
| Business interest | Schedule C, E or F | Interest allocable to a trade or business or rental activity is deducted on the appropriate schedule |
| Personal interest | Not deductible | Examples: revolving charge accounts, personal notes, installment loans on personal-use property, underpayments of income taxes |
| Tax-exempt obligation interest | Not deductible | Interest on debt to purchase or carry obligations whose interest is wholly exempt |
| Qualified passenger vehicle loan interest (QPVLI) | Line 10, for 2025 | Non-grantor trusts and decedents’ estates, loan originated after December 31, 2024, first lien, personal use, final assembly in the United States |
| QPVLI maximum | $10,000 | Reduced if the AGI of the estate or trust is greater than $100,000; use the No Tax on Car Loan Interest Worksheet |
| QPVLI statement | VIN required | Attach a statement with the vehicle identification number of each purchased vehicle |
Investment interest
The instructions describe investment interest as interest on debt allocable to property held for investment; it does not include qualified residence interest or interest taken into account under section 469. The deduction may be limited by net investment income, and Form 4952 figures the allowable amount.
The business interest limit
For business interest the instructions describe a section 163(j) limit and a gross receipts exception for a taxpayer with average annual gross receipts of $31 million or less for the three prior tax years. That interest is deducted on Schedule C, E or F, not line 10.
Car loan interest for 2025
The instructions add a deduction for qualified passenger vehicle loan interest for non-grantor trusts and decedents’ estates. The loan must have been originated after December 31, 2024, be secured by a first lien on a new vehicle for personal use, and the vehicle must have final assembly in the United States. Interest deducted elsewhere on the return cannot be deducted again.
Worked example
The Martin Family Trust (made up) paid $3,500 of investment interest, within its Form 4952 limit, and $2,000 of interest on a loan secured by the residence of a beneficiary who has a present interest. It also paid $400 interest on a personal note. Line 10 shows $5,500 with the Form 4952 box checked; the $400 is personal interest and is not deductible. Names and figures are made up.
More line pages in this set
Related lines: Form 1041 Line 11, Form 1041 Line 14, Form 1041 Line 15a.
Sources
- Instructions for Form 1041 and Schedules A, B, G, J, and K-1 (2025): the line-by-line instructions on this page. Page last reviewed or updated April 30, 2026. Read November 2, 2026.
- Form 1041 (2025), U.S. Income Tax Return for Estates and Trusts: the printed line wording and arithmetic on the form (Form 1041 (2025), created 10/28/25). Read November 2, 2026.
Tax year 2025 forms and instructions: Form 1041 (2025) and its 2025 instructions. Line numbers and labels were read from the IRS PDF and instructions on the date read and can change between tax years, so check them against the form for your year. Names in worked examples are made up.
Frequently asked questions
What goes on Form 1041 line 10?
Deductible interest: investment interest (limited), qualified residence interest of the estate or trust, and certain section 6601 interest on estate tax attributable to a reversionary or remainder interest.
When do I check the Form 4952 box?
If you must complete Form 4952 for investment interest, check the box on line 10 and attach the form.
Is personal interest deductible by an estate or trust?
No. Examples in the instructions include revolving charge accounts, personal notes and installment loans on personal-use property.
Can a trust deduct car loan interest?
For 2025, non-grantor trusts and decedents’ estates may deduct qualified passenger vehicle loan interest up to $10,000, reduced if AGI is over $100,000, with a VIN statement attached.
Where does business interest go?
On the appropriate line of Schedule C, E or F (Form 1040) whose net income or loss is shown on line 3, 5 or 6 of Form 1041.
Not tax advice
This page summarizes IRS instructions, mostly written for the people who prepare the form, and is not tax, legal or financial advice. A CPA or an enrolled agent can confirm what a line means for your return. Everything runs in your browser; nothing you enter is sent anywhere.