The Volokh Conspiracy
Mostly law professors | Sometimes contrarian | Often libertarian | Always independent
Supreme Court Denies Certiorari in Blue State Challenge to Cap on SALT Deduction
An utterly meritless suit ends not with a bang, but a whimper.
This morning, the Supreme Court denied certiorari in New York v. Yellen without comment or noted objection. This should not be a surprise to anyone, and puts an end to one of the more fanciful legal claims put forward by state attorneys general.
This case involved a challenge to portions of the 2017 Tax Cuts and Jobs Act which capped the income tax deduction for state and local taxes. This reform had a disproportionate impact on wealthier taxpayers and on taxpayers in Blue states because they tend to have higher property taxes and income taxes.
New York and several other Blue states sought to argue that capping the SALT deduction was unconstitutional and contravened Supreme Court precedent. As I noted here (and Ilya Somin discussed here), the arguments put forward in defense of this proposition were laughably bad. There is nothing remotely unconstitutional about the decision to offer or rescind federal income tax deductions for state and local taxes. Although the case was heard by a fairly liberal district court judge, and a quite liberal three-judge panel of the U.S. Court of Appeals for the Second Circuit, the legal theories asserted by New York, et al. could not attract a single vote. Indeed, as the lower court opinions made abundantly clear, not a single judge even thought the claims presented a close question.
Now that this lawsuit is over, taxpayers in the plaintiff states no longer have to worry about the squandering of their tax dollars on this utterly meritless litigation, and tax law professor Andy Grewal can rest easy, as he is no longer at any risk of having to post a video of himself "eating every single page of the Internal Revenue Code, one-by-one."
