I’m using TurboTax and hoping someone can clarify if what I am doing is correct. I contributed to Roth IRA, but MAGI is above limit so I recharacterized in 2022. For 2021 tax return, I selected Traditional IRA > No to repayment of distribution > No to excess IRA contributions > No to non deductible contributions to IRA…after saying No to all of the questions, it states that I have a penalty. I thought I didn’t have to pay a penalty if I recharacterized? Any help appreciated!
Not really following. If you recharacterized, it is as if you contributed to traditional IRA on Day 1 and never contributed to Roth. Why are you questioning the penalty? Is your return showing a penalty?
Related to the recharacterization or is it a late payment penalty or other penalty. Can you drill down on the penalty and see how it is calculated?
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OP - I followed these steps and didn’t have to pay any penalty. Take a look. Hope it helps
https://www.whitecoatinvestor.com/how-to-report-a-backdoor-roth-ira-on-turbotax/
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You are welcome!