DanaB27
Expert Alumni

Get your taxes done using TurboTax

No, if you made the contribution for 2022 in 2022 you cannot recharacterize it as a 2023 contribution.

 

You can recharacterize the Roth contribution as a traditional IRA contribution for 2022 and then apply the excess in the traditional IRA on the next year's return. But you will have to pay the 6% penalty on your 2022 tax return and you need to be sure that you are able to make the contribution for 2023.

 

To enter a recharacterization on your 2022 return (request this with your financial institution) :

 

  1. Login to your TurboTax Account 
  2. Click on "Search" on the top right and type “IRA contributions” 
  3. Click on “Jump to IRA contributions"
  4. Select “Roth IRA
  5. Answer “No” to “Is This a Repayment of a Retirement Distribution
  6. Enter the Roth contribution amount 
  7. Answer “Yes” to the recharacterized question on the “Did You Change Your Mind?” screen and enter the contribution amount (no earnings or losses)
  8. TurboTax will ask for an explanation statement where it should be stated that the original $xxx.xx plus $xxx.xx earnings (or loss) were recharacterized.
  9. On the screen "Choose Not to Deduct IRA Contributions" answer "Yes" (if you are thinking about doing a backdoor Roth. If you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible)

 

 

To apply the excess traditional IRA contribution to 2023 on your 2023 tax return:

 

  1. Click on "Search" on the top right and type “IRA contributions”
  2. Click on “Jump to IRA contributions"
  3. Select “traditional IRA
  4. On the "Do you have any Excess Traditional Contributions" answer "Yes"
  5. On the "Enter Excess Contributions" screen enter the total excess contribution from 2022 (if it wasn't carried over).
  6. On the "How Much Excess to 2023?" screen enter how much you want to apply to 2023.
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