Diving deeper into your return, it appears as though when you answered the questions AFTER the 1099-R entries that you selected NO to do you have any IRA's open. You then have a contribution amount still listed that is greater than your distribution amount reported on the 1099-R.
This leaves you with a loss of $66,637. ($131,637-$65,000) IF you no longer have ANY IRA open.
If you took a total distribution from your IRA and have no open IRA's, then this loss is correct and you are entitled to a deduction on your NY return in the amount of $66,637 as calculated.
If you DO still have open IRA's, then you would need to amend your return to note that this is not a loss. It does not have an affect on your federal return, however it does drastically reduce your state refund meaning you would need to pay back the excess refund you received.
IF you DO still have IRA's open and you need to amend your return, once you start the amend, you will go to edit next to the 1099-R, walk through all the steps then KEEP going until you come to the question asking if you still have open IRA's. And YES. Since your amended return would have returned to zero, you should see a tax due amount which is the repayment of the excess refund you received.
How do I amend my state return?
@RAYJDEM
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