You have a federal credit for historical preservation, or a state credit? Which federal form?
The taxes on an IRA are regular income taxes, and are computed on line 16 of form 1040. Most credits are reported on schedule 3, which are applied against your tax on line 17 and line 20, with your final income tax on line 22. Then certain additional taxes are added, like self-employment tax and penalties for excess contributions or early withdrawals from IRAs and other things.
As long as your credit is on schedule 3 and comes off your income tax before line 22, it can offset the income tax from an IRA withdrawal. But credits can't offset penalties or self-employment tax.
If this is a state program, you will pay whatever federal tax you owe for the withdrawal, and if you get a large state refund, that will offset the damage in your bank account but not directly on the tax return.
