Recharacterization of Roth IRA Conversions

If you convert part of your regular IRA to a Roth, you are subject to income taxes on the amount of the conversion. The IRS allows you to change your mind up until the extended due date of the return which would be 10/15/2014 for a 2013 tax return. This recharacterization has to be done through a trustee to trustee transfer. If you transfer the entire amount back to a regular IRA regardless of the earnings or losses for the period of time it was a Roth then there is no tax liability. For example, if you converted $10,000 of your regular IRA to a Roth on June 1, 2013 and then on March 31, 2014 when the value was $12,000 you recharacterized the entire amount back to a regular IRA, then you have to report only the $10,000 on  line 15a on your form 1040. You also have to attached a statement to the 2013 return  indicating the details of the recharacterization.