Hi and welcome to Just Answer!Only the owner of the 401k plan may request the distribution.If the relative was NOT authorized to request the distribution - that fraudulent fact must be reported to the police and police report should be sent to the administrator of the 401k plan - asking to annul the distribution.
If that would not work out - the IRS may waive the 60-day requirement where the failure to do so would be against equity or good conscience, such as in the event of a casualty, disaster, or other event beyond your reasonable control. In the absence of a waiver, amounts not rolled over within the 60-day period do not qualify for tax-free rollover treatment.
The 60-day rollover requirement is waived automatically only if all of the following apply.--The financial institution receives the funds on your behalf before the end of the 60-day rollover period.--You followed all the procedures set by the financial institution for depositing the funds into an eligible retirement plan within the 60-day period (including giving instructions to deposit the funds into an eligible retirement plan).--The funds are not deposited into an eligible retirement plan within the 60-day rollover period solely because of an error on the part of the financial institution.--The funds are deposited into an eligible retirement plan within 1 year from the beginning of the 60-day rollover period.--It would have been a valid rollover if the financial institution had deposited the funds as instructed.
If you do not qualify for an automatic waiver, you can apply to the IRS for a waiver of the 60-day rollover requirement. To apply for a waiver, you must submit a request for a letter ruling under the appropriate IRS revenue procedure.In determining whether to grant a waiver, the IRS will consider all relevant facts and circumstances, including:--Whether errors were made by the financial institution (other than those described under Automatic waiver, earlier),--Whether you were unable to complete the rollover due to death, disability, hospitalization, incarceration, restrictions imposed by a foreign country, or postal error, --Whether you used the amount distributed (for example, in the case of payment by check, whether you cashed the check), and --How much time has passed since the date of distribution.Based on your information - chances to obtain a waiver are very high.
What form has to be filled in order to get waiver from the IRs
In case we have to write a letter what address we have to write a letter
There is no special form.A letter should be attached to the tax returnIf you qualify for an automatic waiver - most likely you do - a letter should be attached to the tax return - to the same address as you send a tax return.If you do not qualify for an automatic waiver - you can apply for a waiver by submitting a request for a letter ruling under the IRS revenue procedure. See more information here - http://www.irs.gov/Tax-Exempt-Bonds/TEB-Private-Letter-Ruling:-Some-Basic-Concepts
You must also pay a user fee with the application.