Constancy ERROR on Rollover - Having a Panic Assault

I hope I can clarify this nicely sufficient to get some recommendation/course. Please take it down a notch so I can perceive

I received a really upsetting letter this morning from Constancy. They admit they made a mistake after they did a partial inservice rollover from my 401K final August 2023.

At the moment, Constancy zero’d out one in every of my funding sources to the tune of $435556.20 (as an example it was a Mounted Revenue fund).

I used to be quoted the next breakdown:
$346192.28 pretax – went into new Rollover IRA
$18875,56 after-tax progress – went into new Rollover IRA
$42160.68 Roth 401K – went into current private Roth IRA
$28327.68 after-tax foundation – went into current private Roth IRA

I obtained 2 1099-Rs in January 2024:
G exhibits: Field 1 – Gross distribution exhibits $393395.52; Field 2a – Taxable quantity exhibits $0.00; Field 5 – Worker contrib/desig Roth contrib exhibits $28327.68.
H exhibits: Field 1 – Gross distribution exhibits 42160.68; Field 2a – Taxable quantity exhibits $0.00; Field 5 – Worker contrib/desig Roth contrib exhibits $42160.68.

The Constancy letter states: “Following a evaluate, it has been found that you just obtained a distribution with earnings associated to after-tax Roth contributions that have been incorrectly attributed to pre-tax contributions leading to incorrect tax data being offered. The right particulars of the distribution and the knowledge that ought to have been included in your IRS Kind 1099-R are offered beneath:

Distribution Date: August 2023
Gross Distribution (Field 1): $365067.84
Corrected TAXABLE Quantity (Field 2a): $365067.78 I used to be instructed the complete rollover was a non-taxable occasion.
Corrected Non-Taxable Quantity: $0.06

In the event you elected to roll over all or a portion of this distribution, we suggest that you just contact your tax advisor to find out :
* Handle after-tax quantities you might have unintentionally rolled over to a conventional IRA or new employer plan, and/or
* Make sure that all quantities rolled over to a conventional IRA or new employer plan from this distribution are correctly recorded as pre-tax or after-tax quantities.

Because of the age of the distribution, Constancy can’t problem an amended Kind 1099-R tax type. To compensate for inconvenience and the potential elevated tax legal responsibility Constancy can pay you an quantity equal to 30% of the quantity reported in error (grossed as much as estimate present yr taxes). In January 2025, you’ll obtain a 2024 IRS Kind 1099-R reflecting this cost as taxable earnings.”

They Constancy rep. mentioned I’ll obtain a reimbursement examine in October. It ought to cowl 1) the taxes owed from their error 2) the taxes owed on the reimbursement examine. There may be nothing additional they will inform me at the moment… simply wait.

MY QUESTIONS:
I do not perceive why $365067.78 is being proven as TAXABLE now within the Constancy letter.
If $365067.78 is now TAXABLE and Constancy goes to pay the taxes on it, will Constancy transfer the monies to a non-IRA account?
I suppose I’ve no selection however to go forward and money the reimbursement examine and set the cash apart. I am unable to sit on the reimbursement examine.
How sticky is that this?