Blue States File Suit Against Irs Over Rules On Salt Workarounds

New Jersey is suing the Internal Revenue Service, challenging new rules that would block states’ attempts to get around a new $10,000 cap for state and local tax deductions.

The state’s governor Democrat Phil Murphy announced the lawsuit on Wednesday morning naming Treasury Secretary Steven Mnuchin among the defendants.

“As I said when the IRS rule was finalized in June, it was nothing more than a gut punch to the middle-class New Jersey families who know that the Trump tax plan is a complete sham,” Murphy said at a press conference in South Orange, New Jersey.  “It was a complete and total utter politicization of the federal tax code,” he said.

New York and Connecticut have also joined the suit, which was filed in the Southern District of New York.