Actually, you cannot recharacterize an already recharacterized contribution. Per Pub 590:
Effect of previous tax-free transfers. If an amount has
been moved from one IRA to another in a tax-free transfer,
such as a rollover, you generally cannot recharacterize
the amount that was transferred. However, see Traditional
IRA mistakenly moved to SIMPLE IRA below.
Page 30 Chapter 1 Traditional IRAs
Since the codes on your 1099R apparently indicate that you did recharacterize (did NOT convert) your specific TIRA contribution as a Roth IRA contribution, and if your MAGI is too high for a Roth contribution, all you can do now is to request a return of an excess contribution with any earnings. You will get back the net earnings adjusted amount, and if the earnings are positive, they are subject to tax and penalty in 2012. Ttax should flag you if your MAGI is too high for the Roth contribution, but you would then have to suspend the return until you process the corrective distribution, and you also need to include an explanatory statement regarding the recharacterized TIRA contribution to Roth and the return of your excess Roth contribution. Then when you get the contribution returned, you can decide whether to re contribute it again as a non deductible TIRA contribution and then convert it to Roth or not. The conversion is what you obviously should have done the first time, and it would have saved some time and expense. There are just alot of rules that trip people up when it comes to IRA rules and plenty of people fall victim.