We are seeing more and more errors like this on 1099-R coding. I just had a client with a 600,000 rollover coded 4 when it should have been G. There are 2 choices. 1) Have the finaancial institution correct the 1099-R. 2) Deal with IRS when they contact the taxpayer and for this option you will need a copy of the IRA statement showoing the Rollover going into the IRA account on the monthly statement for the month of the rollover. I just had a client change their account (large accounts) to Vanguard from a well known financial institution for this reason.