Solved
I converted money from traditional ira to roth ira within 60 days of withdrawal---why is it charging a 10% penalty?
age 50
TurboTax presently has a bug where it is treating an indirect Roth conversion as subject to penalty.
If no taxes were withheld from the code 1 distribution, you can work around the problem by selecting code 2 on TurboTax's 1099-R form instead of code 1. Because there were no taxes withheld, the details of what you selected are not transmitted to the IRS. (If taxes were withheld, I can provide alternative workarounds, but they will involve paper filing by mail.)
I would not wait for a fix to be provided by TurboTax; TurboTax Product Quality has so far not acknowledged the existence of this serious bug.
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