According to the PA Dept of Revenue website, The Federal provisions [of the CARES Act distribution on retirement accounts] are not applicable to PA.
The website states as follows:
PA doesn’t tax distributions from “old age or retirement benefit plans” if the distribution is made after retirement upon reaching age or years of service requirements. Early distributions from retirement accounts are subject to tax to the extent that they were not already subject to tax at the time the money was contributed to the account.
It appears that although the IRS allows you to split the taxable amount of the early distribution over three years, the state of PA wants it all upfront. This could be the reason why you owe the State of PA.
@Matt 126
