LancasterKat

My husband passed away this year (March 2021). We owed $13,587.66 in 401K loans prior to his death. His 401K servicing company did NOT deduct the loan amount from the distribution into my Spousal Beneficiary IRA. (In fact, *I* was the one who discovered the error, but did not notify the company.) If they send us a 1099R, will I have to pay income tax AND an early withdrawal penalty on it? Thank you in advance for your help! Kat