No, you will not submit a Form 5329 with your 2021 tax return because it appears that you are effecting the recharacterization in 2022. Your 2022 tax return will include Form 5329. However, you do need to withdraw the funds from the Roth IRA to limit your penalty/interest exposure.
Yes, a traditional IRA has no income limits. You may not be allowed to deduct your IRA contributions if you, or your spouse, are covered by a retirement plan at work and your income exceeds certain limits. However, you can still contribute to a traditional IRA regardless of your income amount.
Because you are effecting the recharacterization of the Roth IRA in 2022, you will report the various changes you made to your Roth IRA on your 2022 tax return. You will likely receive a 1099-R from the Roth IRA custodian and the amount you withdrew (in order to make the recharacterization) will be included on that 1099-R. You won't need to make complicated calculations. TurboTax will essentially "walk" you through the steps to enter your information and will calculate the penalty if any.
TurboTax Deluxe cd/download versions and the TurboTax Deluxe online version both include Form 5329. TurboTax Deluxe will provide you with the same guidance as TurboTax Premier.
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