This is just a summary screen of your entries (or items carried over), it doesn't mean the income is taxable. You can see if it's being treated as income by taking a look at your 1040. To do that, go to the panel on the left side of the screen and click on tools, then tax tools. Then you can scroll down to "Preview my 1040".
The $123 is your calculated state tax, and the $162 is the money that was withheld from your pay during 2025 and will be used in calculating your refund (or tax due). It's your "payment" already toward your state tax. Your refund is the difference between the two.
[EDITED 03/01/2026 3:09PM PST]
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