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The other thing that screwed us was that because of the tax change, we were only able to claim $700 for medical even though we spent almost $7,000!!!

I'll trade you medical expenses. My health insurance alone was over $15k last year. And then I still have a $6k deductible - which we met.

What also makes me mad is that I should have asked if we could have opened up a traditional IRA and contributed before the 15th, could we have used that deduction to offset our payments. We have Roths but not traditionals. But it's been filed, too late now for this year.

No, it's not. But you don't have much time. You can recharacterize your Roth contributions into a Traditional IRA and then take any allowable deduction on an amended return. I'm sure you have at least until April 15 to recharacterize. Of course, you want to make sure that you will actually get a deduction for Traditional IRA contributions before you do this. And if you didn't contribute the max to the Roth IRAs, you can top up the traditional IRAs with the balance by April 15.

And if I should get a tax shelter IRA, which should it be? Trad or SEP?

Your husband is not self employed, so his can't do a SEP. He'd have to qualify for a deductible traditional IRA to get a deduction. You are self employed, so you can choose either. If your income is too high for a deductible traditional IRA, then you'd need to go the SEP route. However, if your husband does not have a retirement plan at work, choosing a SEP for yourself would put an income restriction on his traditional IRA.

You'll need to spend some time with IRS publication 590 or a tax professional to hash that decision out.

--Peter
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