Answer all questions as if the income is "sourced" in MD, since it is only subject to MD tax. If Boxes 14-16 of your 1099-R are blank, leave them blank. If you are filing a MD resident return, the program will automatically include this distribution in your MD taxable income
Do not add PA to Boxes 14-16 of your 1099-R interview. The only reason you would have PA information in these boxes is if the payer withheld PA tax from your pension. If this is the case, you'd have to enter it and file a PA non-resident return to get a refund of those taxes.
Not sure where you are being asked for the "source of the distribution", but I understand the confusion.
There is no MD information in Boxes 14 - 16 of the 1099-R because the payer did not withhold any MD state tax or report the income to MD.
