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This year, we probably will not have any earned income (unless a 2nd marvelous work from home tech job miraculously appears again like it did for me last year). We will be paying about $1400 a month out of pocket for COBRA health/dental coverage for our family while my husband finishes his degree this year. Will we be able to deduct these premiums on our 2008 taxes? and would someone please explain why or why not?

It's my understanding that if my premiums cost more than 7.5% of my AGI then I can deduct everything above that 7.5%. If 7.5% of $0 is $0, then we should be able to deduct all of it. But will that actually do anything for us, like increase our refund or would it simply serve to reduce taxable income to $0 and not really do anything to help us get a larger refund?

and yes, I'm already astounded at the simple fact that we can earn zero money for a year while we take care of our kids and my hubby can catch up with me professionally while finishing school and get a huge tax refund. It almost makes the giant tax bite of the last ten years (for me at least) not sting so badly.
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