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"and letter from investment advisor that says he did a conversion to the roth and let him know if he went over her 7000 limit."
That doesn't even exist. That is the Contribution Limit. There is no such thing as Conversion Limit.
You mention 401k and SIMPLE IRA as if they are synonyms. They are Different plans and accounts. Did she have an old SIMPLE IRA account that was converted to Roth, making a taxable event?
There is never a penalty for Conversions.
"she put part into this so called conversion. then the rest she kept"
So you have a Pro Rata conversion (if other accounts are pre-tax and have balances) and a Distribution (which might be subject to early penalty).
You have too many things intertwined. They are not intertwined. Take them one at a time.
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