Millions of Americans May Not Get a Tax Refund, But Can Still Unlock Monthly Savings From An Overlooked Expense

Caribou data shows drivers who refinance their car loan can lower their payments by up to $159 a month* even if they do not qualify for new tax breaks

DENVER--(BUSINESS WIRE)--Tax season is one of the most important financial moments of the year for Americans, and with the new auto loan interest deduction and evolving EV tax incentives, vehicle costs have become top of mind for tax filers. But while Americans hunt for refunds, credits, and deductions, auto refinance platform Caribou finds that many overlook a major recurring expense where savings may already be available: their car loan.

One of the most talked-about provisions this tax season is a new deduction on interest paid for certain new vehicles, offering eligible buyers up to a $10,000 tax break. But the vast majority of Americans with car loans may not benefit. Caribou estimates that fewer than 3% of the roughly 100 million Americans with auto loans—about 2.8 million drivers—may qualify, due to restrictions on vehicle assembly location, purchase date, and income thresholds.

Early IRS data suggests tax refunds in 2026 are higher than in 2025, but millions of Americans may not see a refund at all. Bank of America Global Research reports 32% of Americans do not expect a refund this year, similar to 2025 when 37% of tax filers, or roughly 61 million people, did not receive one, according to the IRS.

For drivers looking to stretch their budgets during a time when finances are already under review, refinancing an auto loan can offer meaningful year-round savings.

According to Caribou data from October 1, 2025 to December 31, 2025 of customers who refinanced to lower their monthly payments*:

• Drivers who missed out on EV tax credits may find savings through refinancing. While the federal EV tax incentive lowered purchase costs, buyers no longer qualify if their vehicle was acquired after September 30, 2025. Customers who refinanced electric vehicles saved an average of $190 per month, higher than gasoline and hybrid vehicles, which typically carry smaller loan balances.

• Younger drivers who don’t qualify for the new senior tax deduction are still cutting monthly costs. Millennials saved an average of $169 per month and lowered their APR by 3.54% through refinancing. Gen Z drivers saved $142 per month on average and saw the largest rate reduction of any generation, lowering their APR by 5.05%, likely due to improved credit history after their initial purchase.

• Drivers whose vehicles don’t qualify for the new auto loan interest deduction may still uncover savings. While the new tax deduction applies only to certain vehicles assembled in the U.S., many popular models are produced globally. Toyota owners saved $156 per month on average through refinancing, while Nissan and Hyundai drivers each saved $124 and $118 per month, respectively. BMW drivers saved $180 per month, reflecting the larger loan balances often associated with luxury vehicles. Several 2025 models from these brands are assembled outside the U.S., which means owners who don’t qualify for the federal tax deduction can uncover savings through refinancing.

“Tax season is when millions of Americans pause to review their finances and ask a simple question, ‘Am I leaving money on the table?,’” says Simon Goodall, CEO of Caribou. “While a tax refund can provide short-term relief, many drivers may be overlooking one of their largest recurring expenses. Refinancing an auto loan can help uncover meaningful monthly savings that extend well beyond tax season.”

To see how much drivers could potentially save, visit Caribou.com for tips on stacking savings during and beyond tax season.

About Caribou

Founded in 2016 and based in Denver, CO, Caribou helps drivers take control of their car loan with real savings, trusted lending partners, and expert help every step of the way. With its advanced technology and friendly loan advisors, Caribou makes the auto refinancing process quick, easy, and transparent. Caribou shares the latest auto refinance trends each month, and current refinance rates each day, to provide the most in-depth, real-time insights about the auto refinance market. Customers save up to $159 per month by refinancing through Caribou.* The company is backed by QED Investors, Goldman Sachs, and other leading investors. Learn more at www.caribou.com.

* This information is estimated based on consumers whose auto refinance loan funded through Caribou between 10/1/2025 and 12/31/2025, had an existing auto loan on their credit report, and selected a loan offer to reduce their monthly payment.