The U.S. Supreme Court today kept alive federal litigation that could cost New York a big chunk of the billions of dollars in taxes it collects from nonresidents working for New York-based employers.

The state of New Hampshire had asked the Supreme Court to review a policy under which the neighboring state of Massachusetts has collected income tax from New Hampshire residents who formerly commuted to jobs in Massachusetts, but who have been required to work from home during the pandemic.

As a legal matter, the Court was being asked to take the highly unusual step of asserting “original jurisdiction” in a dispute between two states, skipping all of the usual intermediate steps in federal litigation. New Hampshire cited its “fundamental sovereign interests” in asking the court for leave to file a complaint against its neighboring state.

The case has huge implications for New York, which has long asserted the right to tax the earnings of nonresidents working for New York-based employers in other states. Since the pandemic began in March, this cohort has expanded to include hundreds of thousands of New Jersey and Connecticut residents who had been regular commuters to New York City.

After discussing the New Hampshire filing in their conference on Friday, the nine justices might have simply refused to hear the case. On the other extreme, they might have agreed to take the case right away. Instead, the justices chose a third route, summed up in a single sentence in today’s order list:

The Acting Solicitor General is invited to file a brief in this case expressing the views of the United States.

The Solicitor General of the United States works for the President—so, in effect, the justices want to know if Joe Biden thinks they should take up this case.

As a legal matter, this is a significant step, encouraging to backers of New Hampshire’s case—including the 14 states that filed two different amicus briefs supporting the motion. One of those amicus briefs—arguing that the New Hampshire motion presented an issue of “nationwide and pressing importance”—was filed by four states, including New Jersey and Connecticut, whose residents paid more than $5 billion of New York State personal incomes taxes in 2018.

As a political matter, the case creates an interesting conflict of interest for President Biden. New Hampshire is a political swing state that Biden carried in last November’s election. Massachusetts has long been one of the nation’s most thoroughly Democratic states, although it has a Republican governor. If New Hampshire wins, other beneficiaries would include low-tax red states such as Texas, which signed on to a brief supporting New Hampshire that was also supported by the states of Ohio, Arkansas, Indiana, Kentucky, Louisiana, Missouri, Nebraska, Oklahoma, and Utah.

Other than Massachusetts itself, the state with the greatest interest in squashing the New Hampshire motion is New York.  So far, however, the Cuomo administration has not (yet) bothered to submit a brief in the New Hampshire case.