How to Fill Out and Submit the Schwab IRA Recharacterization Form

Charles Schwab’s IRA recharacterization form, formally titled “Request a Recharacterization or Remove an Excess IRA Contribution,” lets you reclassify an annual IRA contribution from a traditional IRA to a Roth or the other way around. You complete it with the source and destination Schwab account numbers, the contribution amount and tax year, and the net income attributable to that contribution, then submit it through Schwab’s Message Center, by mail, or at a branch before your tax-filing deadline for the year of the contribution.¹

What the Form Can and Cannot Do

Recharacterization applies only to annual IRA contributions. If you put money into a traditional IRA for 2026 and decide a Roth would suit you better, or the reverse, this form reclassifies that contribution. The IRS treats the moved funds as though they were deposited in the second IRA on the original contribution date.²

You cannot use this form to undo a Roth conversion. The Tax Cuts and Jobs Act permanently eliminated conversion recharacterizations for any conversion made in 2018 or later.³ A contribution is new money you deposited for a given tax year; a conversion is money you moved from a pre-tax account into a Roth. Only contributions qualify, and confusing the two is the most common mistake people make with this form.

Your Deadline to File It

The recharacterization election and the trustee-to-trustee transfer must both happen on or before the due date, including extensions, of your federal tax return for the year the contribution was made.⁴ For a 2026 contribution, that means April 15, 2027, or October 15, 2027 if you filed Form 4868 for a six-month extension before the April deadline. The extension is not automatic.

If you filed on time but missed the recharacterization, you can still complete the transfer within six months of the original unextended due date and file an amended return marked “Filed pursuant to section 301.9100-2” at the top.⁵ After that window closes, the original tax treatment locks in.

What to Gather Before You Fill It Out

The form is available at Schwab’s Forms and Applications page.¹ Before you begin, have these ready:

The Schwab account numbers for both the source IRA (where the contribution currently sits) and the destination IRA. Both accounts must be open. If you don’t yet have the second IRA at Schwab, open it first.
The exact dollar amount you want to recharacterize. You can move all of the contribution or just part of it.
The tax year the contribution was designated for. That is not always the calendar year of the deposit: a contribution made in February 2027 for tax year 2026 lists 2026.
The net income attributable, or NIA, which is the gain or loss the contribution earned in the source IRA. This amount moves along with the contribution.

Federal regulations require the election to include the type and amount of the contribution, the date it was made, the year it was made for, a direction to transfer the contribution plus NIA to the second IRA, and the names of both trustees.² The Schwab form walks through each of these fields, so completing it fully satisfies the regulatory requirements.

Contribution limits cap the amount eligible for recharacterization. For 2026, the annual IRA contribution limit is $7,500 if you’re under 50 and $8,600 if you’re 50 or older.⁶

How Net Income Attributable Works

The NIA figure determines how much money actually moves. In most cases Schwab’s custodial team calculates it for you. If you want to verify the number or you’re recharacterizing part of a contribution, IRS Publication 590-A Worksheet 1-3 provides the formula: multiply the recharacterized contribution by the account’s rate of return over the period the contribution was invested, then add that gain or loss to the contribution to get the total transferred.⁵

If the investments lost value, the NIA is negative and less than the original contribution reaches the destination account. A $5,000 contribution with an NIA of negative $300 results in a $4,700 transfer.⁷ You don’t owe anything to make up the shortfall, and the full original contribution amount still counts against your annual limit for the destination IRA.

Submitting the Form to Schwab

Schwab accepts the completed form through several channels. Uploading it as a secure document through the Message Center after logging in is the fastest. You can also mail the form to the processing address in its instructions or bring it to a local branch. Some account holders start the process by phone, but the representative collects the same information the form does, so you may as well complete it once.

After Schwab receives the request, expect a confirmation through the Message Center or by email. The transfer between IRAs typically takes several business days to show up in your balances. Check the destination account’s transaction history to confirm the recharacterized contribution and NIA landed correctly.

The Tax Forms That Follow

A recharacterization generates two documents from Schwab. Form 1099-R reports a distribution from the original IRA. Box 7 shows code N if the contribution and recharacterization occurred in the same calendar year, or code R if you’re recharacterizing a prior-year contribution.⁸ Form 5498 reflects the contribution received by the destination IRA. Both are typically posted in the first few months of the following year.

On your return, report the recharacterization following the Form 8606 instructions and treat the contribution as if it had always been made to the second IRA.⁵ If you moved a traditional contribution to a Roth, you don’t claim a deduction for the original traditional contribution, because in the eyes of the IRS it was never traditional. The 1099-R shows the fair market value in Box 1 and zero in Box 2a, confirming this is not a taxable event.⁸ Keep copies of the Schwab form, both tax forms, and any NIA calculation you did in case the IRS asks why a distribution and contribution appear for the same dollars.

If You Miss the Deadline

Once the recharacterization window closes, the contribution stays where it is with its original tax treatment. If the contribution created an excess, most often because your income exceeded the Roth eligibility threshold, the IRS imposes a 6% excise tax on the excess for every year it remains in the account. You report the penalty on Form 5329 and pay it with your return.⁹

The 6% penalty recurs each year the excess sits in the account. Withdrawing the excess and its NIA stops future penalties, and if you’re otherwise eligible you can absorb it into the following year’s contribution limit. Either path is more work than filing the recharacterization on time, so build in a buffer instead of waiting until the last week.

1
Charles Schwab. Request a Recharacterization or Remove an Excess IRA Contribution
2
GovInfo. 26 CFR 1.408A-5 – Recharacterized Contributions
3
Internal Revenue Service. Instructions for Form 8606
4
eCFR. 26 CFR 1.408A-5 – Recharacterized Contributions
5
Internal Revenue Service. Publication 590-A – Contributions to Individual Retirement Arrangements (IRAs)
6
Charles Schwab. Roth IRA Contribution Limits for 2025-2026
7
Ascensus. Calculating Earnings for Timely IRA Excess Removals and Recharacterizations
8
Internal Revenue Service. 2025 Instructions for Forms 1099-R and 5498
9
Internal Revenue Service. Form 5329 – Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts