Thank you so much for clarifying yet again this complicated subject (for my fried brain!).
I understand the first two paragraphs, the third one, not so much. Can you please clarify "correct return of contribution" and "regular distribution"? Do you mean "correct return of contribution = 7000-losses"? What is "regular distribution" in this case?
Doesn't roll-over mean reversing the transaction (return 7000 to IRA)? Once it is returned, it can be re-distributed correctly including losses? Wouldn't the corrected distribution be reported on 1099R?
Different question - if I were able to undo the distribution, will it be better to move it to a Roth? Will there be filing advantages or another can of warms??
