Received 2023 1099-R with Code R after Roth IRA recharacterization - Do I need to amend my 2022 tax return?

This is actually a common scenario with IRA recharacterizations. The 1099-R with Code R is reporting the recharacterization of your Roth IRA contribution to a traditional IRA. The good news is that since you recharacterized before filing your 2022 taxes, you typically don't need to file an amendment for 2022. The 1099-R with Code R should be reported on your 2023 tax return (the year it was issued), but it generally doesn't create any tax consequences since box 2a shows $0 taxable amount. The Code R specifically tells the IRS this was a recharacterization, not a distribution. TurboTax might be confused because recharacterizations can sometimes require amendments, but if you properly reported everything on your original 2022 return (reporting contributions as if they were made to the traditional IRA from the start), you shouldn't need to amend.

I had almost this exact situation last year and found taxr.ai really helpful for sorting it out. I was getting mixed advice about my 1099-R with Code R and whether I needed to amend previous returns. I uploaded my 1099-R and some notes about my recharacterization to https://taxr.ai and got a clear explanation about how to handle it correctly. The tool explained exactly what Code R meant on my 1099-R and confirmed I only needed to report it on the current year's return since I had done the recharacterization before filing the previous year's taxes. Saved me from filing an unnecessary amendment and potentially creating more confusion with the IRS.

I just tried taxr.ai for my own Code R situation with my Roth conversion, and I'm actually impressed. I was really skeptical at first (as you can see from my question above), but it cleared up my confusion about whether my 1099-R needed to be reported on 2023 or if I needed to amend my 2022 return. The analysis confirmed I only needed to report it on my 2023 return and explained exactly where in TurboTax to enter it so it wouldn't trigger that amendment warning. It also explained why TurboTax was suggesting an amendment (basically a software limitation in how it interprets Code R transactions). Saved me from filing an unnecessary amendment and potentially causing more confusion with the IRS.

If you're having trouble getting clear answers from TurboTax about your 1099-R situation, you might want to call the IRS directly. I know it sounds crazy because nobody can ever get through, but I used https://claimyr.com and got connected to an IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c I had a similar issue with a recharacterization and needed to know if I should amend my previous return. The IRS agent confirmed that since I recharacterized before filing the original return, I didn't need to amend. They explained exactly how to report the 1099-R with Code R on my current year return. Totally worth it to get an official answer directly from the IRS.

I was totally wrong about Claimyr in my comment above. After waiting on hold with the IRS for 2+ hours over three separate days trying to get an answer about my 1099-R recharacterization, I broke down and tried Claimyr. Got connected to an IRS agent in about 20 minutes. The agent confirmed exactly what I needed to know - that my 1099-R with Code R should be reported on my current year return and that I didn't need to file an amendment since I did the recharacterization before filing my original return. She even directed me to the specific line where it should be reported. Hate to admit when I'm wrong, but this service actually delivered exactly what it promised. Saved me hours of frustration and gave me peace of mind that I'm handling this correctly.

One thing nobody has mentioned yet - you should check if you're eligible for a deduction for the traditional IRA contribution that resulted from your recharacterization. If your income is below certain limits and you don't have a retirement plan at work, that contribution might be deductible on your 2022 return. If that's the case, then you WOULD want to amend your 2022 return to claim that deduction. But if you're not eligible for the deduction (income too high or covered by workplace plan), then you wouldn't need to amend just to report the recharacterization.

I think everyone is overcomplicating this. The Code R on 1099-R literally just means "Recharacterized IRA contribution." The IRS knows exactly what this is. You report it on your 2023 return (the year of the 1099-R) and move on. Box 2a is $0 because there's no taxable amount - it's just moving money from one type of IRA to another. TurboTax is suggesting an amendment because their software is designed to be extra cautious. But unless you're eligible for a traditional IRA deduction you didn't claim (which sounds unlikely given you have a 401k), there's no benefit to amending.

Just to add some clarity from the technical side - when you recharacterized your Roth IRA contribution to traditional before filing your 2022 return, you essentially treated it as if the contribution was always made to the traditional IRA. The 1099-R with Code R in 2023 is just the custodian's way of reporting that recharacterization transaction to the IRS. Since you did this before filing your 2022 taxes, your original return should have reflected the traditional IRA contribution (either as deductible or non-deductible depending on your income and workplace plan). The key question now is whether you properly reported that traditional IRA contribution on your 2022 return. If you didn't report it at all, you might need to file Form 8606 for non-deductible contributions to establish basis, but that's separate from the 1099-R Code R issue. The 1099-R itself goes on your 2023 return with no additional tax owed since box 2a shows $0 taxable amount.