Retirement tax questions

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

1. Login to your TurboTax Account 
2. Click on the Search box on the top 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 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"

You will get two 1099-R in 2022 for 2021.

One 1099-R will be for the (backdoor) conversion from traditional IRA to Roth IRA and will be entered on your 2021 tax return. Please see How do I enter a backdoor Roth IRA conversion? for additional detail how to enter this in your 2021 tax return.

The second 1099-R will be for the recharacterization with code R-Recharacterized IRA contribution made for 2020 and belongs on the 2020 return. But a 1099-R with code R will do nothing to your return. 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.