If you use that 20K to pay back 20k, they cancel each other out, but there's a catch. you may or may not have a tax in this year, because no more than one third of the original amount can be applied. any more would be taken in prior years by amending (2022 is the last tax year).
If you have an early distribution you still pay the penalty. it doesn't count as a 60-rollove
@FlaxSeedQ
If you didn't divide by 3.0, you would amend your 2020 tax return to show the $20,000 paid back.
