A 504 plan should address this completely UNLESS she has a developmental disability that is enough to get her in the special ed program.
The tutoring and extra help from the teacher should be enough to bring her up. Don't just assume she needs to be held back, okay? Think about this. If math is the only area she struggles then doing this grade over will be awful for her. She'll be spending 80% of her day doing the same work she did this year.
See if there is a summer school program around that does math. Some districts have one school that will have summer school classes.
I'd see how the diagnosis goes too. Testing for disabilities at this age used to be really common but with so many kids going to pre-school, pre-K, then by kindergarten the teachers are very familiar with the kids and can see what is normal for them and if they're having any issues that need to be diagnosed.
Third grade is sort of a turning point academically. They have to do so much of the basics that the rest of their math is based on. Our girl didn't learn anything in 3rd grade math. Almost every kid that went through that class had to do tutoring and work extra hard in 4th grade. She learned 3rd grade math, 4th grade math, and was into 5th grade math by the end of 4th grade. Her teacher kept her after school 2 days per week. She flourished under this teacher and bloomed.
I think you're on the right track. Just don't automatically expect her to be held back. If there isn't a diagnosis and she's passing everything else see how she's doing at the end of summer before agreeing to being held back.