One option would be to report it as if it was an in-plan rollover by submitting a substitute Form 1099-R with the taxable amount in box 2a as I described earlier, but who knows if the IRS would accept that (or at least not flag it as a problem). Assuming that there is no basis in after-tax contributions to either 401(k), the taxable result is the same as if it have been done correctly.
Another possibility would be to treat the original rollover as if it had been a rollover to the traditional account in the new 401(k) as reported on the 2024 Form 1099-R that you received, then file the substitute code-G Form 1099-R from the new 401(k) as if deposit into the traditional account in the new 401(k) had been immediately followed by an IRR (essentially claiming that the new plan failed to provide the Form 1099-R for the IRR). I'm not sure that this would be a viable approach either, and would probably have an even greater chance of raising a red flag with the IRS.
The technical answer is that this seems to be a failed rollover that would have to be removed as an excess contribution, perhaps followed by a late rollover to the traditional account in the new plan with self-certification under IRS Rev. Proc, 2020-46 that it would qualify for a waiver of the 60-day rollover deadline, further followed by a proper in-plan rollover, plan permitting. The taxable result would be largely the same except that the taxable income would be reportable on your 2025 tax return instead of on the 2024 tax return because the IRR would be occurring in 2025. Another technically proper approach would be to do the late rollover to a Roth IRA after the removal of the failed rollover to the designated Roth account. (A taxable rollover to a Roth IRA is permitted.) This would at least keep the taxable income in 2024.
As you can see, there is no ideal way to deal with this. It's unfortunate that many 401(k) administrators don't actually know the rules very well and allow these sort of mistakes to be made. They should be making sure that a rollover to their designated Roth account actually was a rollover from another designated Roth account, the only kind of rollover to a designated Roth account that is permitted. There has been at least one other post in this forum this year where the receiving 401(k) allowed such a mistake to be made.
