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Retirement tax questions
The earnings for a recharacterization aren't taxable income but the recharacterization should have been reported on your 2023 return with the steps below.
- Login to your TurboTax Account
- Click on "Search" on the top right and type “IRA contributions”
- Click on “Jump to IRA contributions"
- Select “Traditional IRA”
- Answer ‘Yes” on the “Traditional IRA Contribution” screen
- Answer “No” to “Is This a Repayment of a Retirement Distribution
- Enter the contribution amount
- Answer “Yes” to the recharacterized question on the “Switch from a Traditional To a Roth IRA?” screen and enter the contribution amount (no earnings or losses) on the next screen.
- 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.
TurboTax will include the explanation statement with your return. Please see How do I amend my federal tax return for a prior year?
You will use the same steps on your 2024 return to report the recharacterization you made in 2024.
Note, Form 1099-R with code R will do nothing to your return. You can only report it as mentioned above. Therefore, you can ignore the Form 1099-R with code R. 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.
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February 16, 2025
3:28 AM
1,617 Views