money amount was 136000. I placed it in a regular checking account under the assumption that I would lose 50% in penalties if I didn't.
You may have recourse but it is a slim possibility. Any financial advisor, even though a bank, should have told you that this was not the right course of action. See if you can have them write a letter, admitting they did not live up to their fiduciary responsibility, and send it to the IRS. I have personally seen this approach work. It may or may not again. They may sympathize with the fact that you did not know what you were doing and that you were not properly guided.
What penalty? For not taking the RMD? You didn’t have to take the total balance out. Just the RMD amount. Yes the full amount distributed is taxable now.
Did they take any tax withholding out of it? It will add to your regular income and will push you into a higher tax bracket so don’t be shocked at your tax return. You will probably owe a lot. Did you make any non-deductible contributions? You need to enter the 1099R. What code is in box 7? If you have more questions then @dmertz can explain it more.
When did you take the distribution?
The trustee of the IRA has an obligation to notify you of the RMD amount which is the total 2016 year end value decided by the live expediency table amount (26.5 for age 71). If the 2016 year end value was about $136,000 then the 2017 RMD would only be about $5,132.
The 50% penalty would only apply if you failed to take that at all. even it taken late the IRS will almost always waive the penalty.
You may have recourse but it is a slim possibility. Any financial advisor, even though a bank, should have told you that this was not the right course of action. See if you can have them write a letter, admitting they did not live up to their fiduciary responsibility, and send it to the IRS. I have personally seen this approach work. It may or may not again. They may sympathize with the fact that you did not know what you were doing and that you were not properly guided.