I assume that the return of the excess contribution made to the IRA (the result of rolling over the RMD) occurred in 2023. In addition to the code-7 2023 Form 1099-R that reports the RMD for the IRA, you husband will be receiving either two or three other 2023 Forms 1099-R, one with code G for the rollover from the 401(k) to the IRA and another with code 8 (or maybe codes 7 and 8 together) for the corrective distribution from the IRA and, maybe one with code 7 reporting the distribution of the RMD form the 401(k).
If the code-G Form 1099-R shows only the portion eligible to be rolled over and there is a code-7 Form 1099-R from the 401(k) reporting the RMD portion, just enter all of the Forms 1099-R as received. Since the problem was caught before any Forms 1099-R were issued, hopefully this is how it will be reported.
If the code-G Form 1099-R shows the entire amount originally rolled over to the IRA and there is no code 7 Form 1099-R from the 401(k) for the RMD portion of the distribution, it will be necessary to create substitute Forms 1099-R to split the code-G Form 1099-R into a code-G From 1099-R for the portion eligible to be rolled over and another with code 7 for the portion that was RMD.
This answer has been verified for accuracy by an Intuit expert employee
