Re prior post if you would like to read:
http://forum.thetaxbook.com/showthre...highlight=code

IRS seem to not understand the situation and wanted a Form 8606 which did not apply in this situation. I told the client to ask the bank for a amended 1099-R to show the correct Code 8.
Well, I never did hear again from the client until today. They tried to handle it on their own. The Bank said they would not amend the 1099-R because it had been 3 years and it was against the law to amend after that time.

Have any of you heard of this?

First it has been 2 years from the date of the tax year and second if the form is incorrect do they not have the obligation to amend?