U.S. · Tax forms
Form 8990 line 30, current year interest deduction.
The smaller of line 29 or line 5, and what happens to the disallowed remainder.
Line 30 (“Total current year business interest expense deduction”) is the amount of business interest you can deduct this year after the section 163(j) limit. A taxpayer subject to the limit enters the smaller of line 29 or line 5. Line 31 is whatever is left over, the disallowed business interest expense.
Look up a line
Result
Lines 26 to 31
| Item | Meaning | What the IRS says |
|---|---|---|
| Line 5 | Total business interest expense | Total business interest expense. Add lines 1 through 4. |
| Line 26 | 30% of ATI | Multiply the adjusted taxable income from line 22 by the applicable percentage. The applicable percentage is 30%. |
| Line 27 | Business interest income | Business interest income (line 25). |
| Line 28 | Floor plan financing interest | Floor plan financing interest expense (line 4). |
| Line 29 | Limit | Total. Add lines 26, 27, and 28. |
| Line 30 | Deduction | A taxpayer subject to the section 163(j) limitation will enter on line 30 the smaller of line 29 or line 5. |
| Line 31 | Disallowed | Subtract line 29 from line 5. If zero or less, enter -0-. |
| Several deduction locations | Allocate in proportion | If the amount on line 29 is less than the amount on line 5 and business interest expense is reported on more than one location on the return, the disallowed business interest expense must be allocated to each source in proportion to the total business interest expense from each source. |
The comparison on line 30
Line 29 is your limit: 30% of ATI, plus business interest income, plus floor plan financing interest expense. Line 5 is what you actually have. Line 30 is the smaller of the two, so if your limit exceeds your expense, you deduct all of it and line 31 is zero.
Partners not subject to the limit
If a partner is not subject to the section 163(j) limitation and has partnership excess business interest expense treated as paid or accrued in the current year, the instructions say to enter the amount from Schedule A, line 44, column (h) on line 30. That amount is not subject to further limitation under section 163(j).
More than one deduction location
If business interest expense appears in more than one place on the return (the instructions give ordinary business interest expense and farming interest expense as examples) and line 29 is less than line 5, allocate the disallowed amount in proportion to each source and attach a schedule to Form 8990 showing the amount and the return line where the interest is deducted.
Worked example
Made-up numbers. Line 5 total business interest expense is $500,000. ATI on line 22 is $1,000,000, so line 26 is $300,000; line 27 business interest income is $50,000 and line 28 is $0. Line 29 is $350,000. Line 30 is the smaller of $350,000 or $500,000, which is $350,000, and line 31 disallowed interest is $150,000.
More line pages in this set
Related lines: Form 8990 Line 6, Form 8990 Line 11, Form 8990 Line 19.
Sources
- Instructions for Form 8990 (12/2025): the line-by-line instructions on this page. Page last reviewed or updated April 30, 2026. Read November 2, 2026.
- Form 8990 (Limitation on Business Interest Expense Under Section 163(j)): the printed line wording and arithmetic on the form. Read November 2, 2026.
Instructions for Form 8990, December 2025 revision. The line labels were read from the Form 8990 (Rev. December 2025) PDF the IRS had posted on the date read. Line numbers can shift between years, so check them against the form for your tax year. Examples marked made-up use invented figures; the others reproduce the IRS’s own examples.
Frequently asked questions
What goes on Form 8990 line 30?
For a taxpayer subject to the section 163(j) limitation, the smaller of line 29 or line 5.
What is line 29?
The sum of line 26 (30% of ATI), line 27 (business interest income) and line 28 (floor plan financing interest expense).
What happens to interest above the limit?
Line 31 is line 5 minus line 29 (not below zero) and is the disallowed business interest expense.
What if my interest is deducted in more than one place?
Allocate the disallowed amount in proportion to the total from each source and attach a schedule showing the amount and the return line.
What percentage applies?
The instructions state the applicable percentage is 30%, applied to ATI on line 26.
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.