We contributed money to traditional IRA in December 2018,
then covert it to Roth IRA in February 2019.
The fund converted to the Roth IRA was applied to Tax year 2018. When we work on the Turbo Tax, we are
informed that we have excess Roth contributions because our income is too
high. We are suggested by Turbo Tax to “recharacterize”
the excess Roth IRA money back to traditional IRA. However, the financial institute reply to us
that “The Tax Cuts and Jobs Act repealed the ability to recharacterize a
conversion. That means if you converted a traditional IRA to a Roth IRA in 2018
or after, you are not be able to recharacterize it back to a traditional IRA.” If so, how can we do to avoid the tax penalty?
Thank you very much!
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