Escalating tensions between coastal states and the federal government about circumventing the $10,000 cap on state and local tax deductions have so far drawn a big yawn from states in the middle of the country.
High-tax Midwestern states such as Illinois, Iowa, Minnesota, and Wisconsin have essentially ignored the warfare between the Treasury Department and coastal states—including California, Connecticut, New Jersey, and New York—which enacted strategies designed to ease the pain of the 2017 tax law’s SALT limit.
In June the Treasury Department targeted (T.D. 9864) a strategy that would allow taxpayers to donate to state-sponsored charitable funds ...