I converted money from traditional ira to roth ira within 60 days of withdrawal---why is it charging a 10% penalty?

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.

But if you would please, at the top of the program click the ONLINE option and select "send tax file to agent". After it removes all of your personal information the sanitized file is sent to TurboTax and you will be presented with a 6-digit token number. Post that token number here please so the agents can know what post your sanitized file is associated with. Hopefully you get a token.

Having the same problem. moved $30k from IRA to Roth IRA. Sent file via online.

I sent file to an agent. Who should I share token # with?

taxdaughter2, just to be certain that you are experiencing the same bug, what is the code in box 1 of your Form 1099-R for the distribution from the traditional IRA?

Code in box 7 is 1

Since you are not in contact with a TurboTax support agent, I suggest posting the Token number here.

I don't have much hope that we'll see this bug get fixed by the filing deadline.  If the Form 1099-R shows no tax withholding in box 4, I suggest using the workaround mentioned above.

@taxdaughter2 you need to post the token number here. Without that token number, the agents and programmers have no clue who to tie the sanitized file to that you sent them, and therefore have no idea "why" you sent it.

token number is 495401

@TurboTaxGabi see above for token.