@ColeenD3
NOOOOOO.... this statement is wrong : Since you paid taxes already, then you may divide it into 3 equal payments as well.
The entire amount withheld in 2020 MUST be entered on the 2020 return ... failure to do so will delay the processing of the return while the IRS fixes the error and if they don't then amending of the return will be needed. Although the distribution can be divided into 3 parts over 3 tax years the taxes withheld cannot be divided.
If they wish to let the IRS hold some of the 2020 refund to the next tax year so they are not short in 2021 they can by applying some or all of the refund. Then on the 2021 return they can do it again ... apply some or all of the 2021 refund to the 2022 return to cover the third installment.
