Get your taxes done using TurboTax

1. Yes, you will have to pay the 6% penalty for the 2023 excess on your 2024 return since it wasn't removed by December 31, 2024.  Please note, you cannot make a recharacterization after the due date. See Pub 590-A for details. Please check with your financial institutions since they should not have accepted a recharacterization after the due date. 

You must take a regular distribution (without earnings) to remove an excess contribution after the extended due date.

2. No, you do not pay the 6% penalty for the 2024 excess since you recharacterized the excess before the due date.

You will enter the recharacterization when you enter the contribution to the Roth IRA for 2024:

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 ‘Yes” on the “Roth IRA Contribution” screen
6. Answer “No” to “Is This a Repayment of a Retirement Distribution
7. Enter the Roth contribution amount 
8. Answer “Yes” to the recharacterized question on the “Switch from a Roth To a Traditional IRA?” screen and enter the contribution amount (no earnings or losses) on the next screen.
9. 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.
10. On the "Do you have any Excess Roth Contributions" answer "Yes"
11. On the "Enter Excess Contributions" screen enter the total excess contribution from 2023 (if it wasn't carried over).
12. On the screen "Choose Not to Deduct IRA Contributions" answer "Yes" if you are thinking about doing a backdoor Roth. Otherwise select "No". (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)

You will get a 2025 Form 1099-R  for the recharacterization with code R-Recharacterized IRA contribution made for 2024 and this belongs on the 2024 return. But a Form 1099-R with code R won't change anything on your return. You can only report it as mentioned above. Therefore, you can ignore the Form 1099-R with code R when you get it in 2026. The box 1 on the 1099-R will report the total recharacterized amount (contribution plus earnings) but it does not separately report the earnings and box 2a must be zero.

Please see What if I made an excess Roth IRA contribution for additional information.