"On the other hand, a recharacterization is nontaxable. The $2,564.03 of gains would simply become tax deferred gains in the traditional IRA."
I presume you to mean I should reconsider "carrying forward" the $7,000 ROTH IRA contribution and instead look to re-characterize the $7,000 ROTH contribution, to non-deductible IRA contribution status, for the 2020 tax year. This would defer paying ordinary income tax on the net increase, now; I would also avoid paying the $420 penalty, as the non-deductible IRA is allowed for MAGI at $208,000 and above? Do I have that correct.
The trade off to consider is the potential tax free growth on the 2020 ROTH IRA contribution and it's net increase, going into the future, for the cost of $420 today? Do I have those two perspectives correct?
