Whatever was withheld for taxes will be credited on your federal and state 2023 tax returns. The amount distributed is taxable on your 2023 tax returns. This will all be done automatically in 2023 TurboTax when you enter the 2023 Form 1099-R that you will receive near the end of January 2024. If you were under age 59½ at the time of the distribution, the entire distribution will be subject to a 10% early-distribution penalty on your federal tax return. [Corrected]
