"Box 7 Distribution Code 1. Early distribution, no known exception."

Because the issuer has no idea if that was Rolled over or not.

"60 day rollover's are limited to 1 "In any one year period"."

Both are "to the Day." Your client should reconsider treating this as a piggy bank.

https://www.investopedia.com/articles/retirement/06/rollovermistakes.asp