You haven’t given enough information to say whether it would be possible to include a half bath (toilet and lav) in the garage bedroom.
You mention a water line, by which I assume you mean a cold water supply. What about hot water supply? What about drain lines? If the garage is on slab, you could run the pipes by raising the floor of the room addition a foot or two above the slab, but you still need to have enough elevation to run your drains (wherever it is you plan to tie them into).
The general answer is that almost anything is doable in terms of adding a bath addition.