I was reading IRS Stops Attempt To Bypass Trump Tax Law, MD Lawsuit Continues. The article states:
... The IRS said Tuesday that states cannot bypass a $10,000 cap on state and local tax (SALT) deductions imposed by the Republican tax law of 2017. That hurts taxpayers in high property tax states like Maryland.
The IRS effectively nullified legislation in New Jersey and several other states that allowed municipalities to establish charitable funds where taxpayers can donate in return for a property tax credit. The legislation was intended to protect taxpayers from a potential increase in the federal income tax as a result of the Trump Administration's cap on the state and local tax deduction (SALT).
The article is brief, and seems to lack the exact details how how the federal government is achieving its goals. Or maybe it is there and I don't see it (fiat?).
In any case, I thought states are allowed to determine their own criteria for tax credits. It seems like the federal government is imposing tax law at the state level.
Does the federal government have authority to impose tax laws at the state level?