New York judge dismisses blue state suit over SALT tax deductions

On Monday, a federal judge dismissed a lawsuit filed by four states against the IRS, thwarting four blue states’ challenge against a new $10,000 cap on the deduction for state and local taxes, also known as SALT. Those states — New York, New Jersey, Connecticut and Maryland — sued the Treasury Department, Treasury Secretary Steven Mnuchin and the IRS, among others, in July 2018. They alleged that the new limit on the SALT deduction, part of the Tax Cuts and Jobs Act of 2017, was “an unconstitutional assault on states’ sovereign choices.”