Here's my situation:
In May 2018, I contributed $1000.00 to my Roth IRA, in April 2019 I contributed $5500.00, total of $6500.00 for 2018 tax year.
While working on my taxes for 2018 I found out that I was over the income limit for Roth IRA and so I asked my broker Charles Schwab to recharacterize this $6500 contribution and associated earnings/losses Schwab transferred approximately $6000.00 to my brokerage account due to $500.00 loss.
I had already entered $6500.00 contribution for my Roth IRA, I entered $6000.00 for recharacterization. I noticed Turbo Tax is keeping $30.00 penalty ($500 * 6% = $30.00)I am concerned that this $30.00 penalty will continue for future years; I don't know how to enter the fact that I lost $500 while $6500.00 was in my Roth IRA account.
Please help so I can correct this minor problem and file my tax return for 2018.
Thank you very much.
FYI, I'm told the 1099-R for this recharacterization is not going to be produced until next year (2020).
