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Four States Claim Federal Tax-Deduction Cap Infringes Rights

2017 tax law overturns 150 years of precedent, states say
New York, New Jersey, Connecticut, Maryland file lawsuit

manhattan — Photographer: Craig Warga/Bloomberg

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July 17, 2018, 2:10 PM UTCUpdated onJuly 17, 2018, 10:02 PM UTC

Four Democratic-led northeastern states sued the Trump administration to invalidate the new $10,000 cap on the federal tax deduction for state and local taxes that they say unfairly targets them.

New York, New Jersey, Connecticut and Maryland claim the sweeping 2017 federal tax law overturned more than 150 years of precedent. The state and local tax deduction is essential to prevent federal tax powers from interfering with constitutionally guaranteed state rights, according to the lawsuit.