Judge Rejects DOJ Motion to Dismiss Oklahoma Suit Against IRS Tax Credit Rule

Earlier today the U.S. District Court for the Eastern District of Oklahoma rejected the federal government’s motion to dismiss in Oklahoma v. Sebelius, a challenge to the legality of an IRS regulation extending the availability of tax credits to federal exchanges under the PPACA. The text of the PPACA only provides for tax credits in exchanges “established by the State” and otherwise fails to provide for tax credits in federal exchanges, as explained in detail here. The court rejected the federal government’s argument that Oklahoma lacked standing to pursue its claims. Here are early news reports. Another suit against the IRS rule is pending in the federal district court in D.C.