One year ago I received ESOP distribution from my former employer that I rolled over to a traditional IRA. Today I received a phone call from the company that maintains my IRA saying that the employer overpaid, and that want $6000 back.
If the error is correct, I have no problem giving back the money, but I obviously I do not want to pay tax penalties for making an early withdrawal from IRA.
Will there be tax penalties, and if so, who would be responsible for paying the penalties? Were does the law stand in this unusual case?
Is the law different in different states? I live in Oregon.