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Re: Malpractice Insurance deduction

I had another client in this same situation, and because of the AMT, they essentially saved no federal income taxes on the malpractice insurance they needed to pay out of pocket.

Unless you can somehow generate some independent contractor income while you're between jobs, the $40k in malpractice insurance premiums will most likley cost you $40k in after-tax dollars.

Is there any way you can spread this payment over multiple years? Congress is trying to find a way to reduce the impact of this tax, so maybe you'll save some taxes in future years with this malpractice payment.

From what I can gather, many states don't have a tax equivalent to the AMT. So if you live in a state that allows you to claim itemized deductions, you might be able to save some state taxes. At least that is something.

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