SALT Cap Is Constitutionally Permissible

New York, Connecticut, Maryland, and New Jersey had challenged the constitutionality of the $10,000 cap on the itemized deduction for state and local income or sales taxes and property taxes. The states argued that the SALT cap was an unconstitutional infringement on their ability to tax their residents. An appellate court had ruled last year that Congress was allowed to impose the limit (New York v. Yellen, CA-2 10/5/21). Now, the U.S. Supreme Court has refused to hear an appeal by these states (4/18/22). The Court did not give any reason for its refusal. The SALT cap is set to expire after 2025. Congress has been debating ways to repeal or at least ease the cap, but nothing has been done as yet.