Recharacterization from Roth Ira to Traditional IRA

To confirm your Form 1099-R has code R or N? 

 

Yes, recharacterizations are not taxable. If you have code R you can ignore it. If you have code N you enter it but it isn't taxable.

 

You also report the recharacterization in the IRA contribution interview. You will enter the recharacterization when you enter the contribution to the Roth IRA:

 

1. Login to your TurboTax Account 
2. Click on "Search" on the top right and type “IRA contributions” 
3. Click on “Jump to IRA contributions"
4. Select “Roth IRA”
5. Answer ‘Yes” on the “Roth IRA Contribution” screen
6. Answer “No” to “Is This a Repayment of a Retirement Distribution
7. Enter the Roth contribution amount 
8. Answer “Yes” to the recharacterized question on the “Switch from a Roth To a Traditional IRA?” screen and enter the contribution amount (no earnings or losses) on the next screen.
9. 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.
10. On the screen "Choose Not to Deduct IRA Contributions" answer "Yes" if you are thinking about doing a backdoor Roth. Otherwise select "No". (If you have a retirement plan at work and are over the income limit it will be nondeductible automatically and you only get a warning and then a screen saying $0 is deductible)

 

 

 

Thank you, what do you mean if it is R then ignore it ? 

You don't need to enter Form 1099-R with code R because it won't change anything on your return (IRS). In this chase you only report the recharacterization in the IRA contribution interview.