You must enter the Form 1099-R exactly as it appears on the Form 1099-R provided by the payer.
Having taxes withheld does not make the distribution nontaxable. The distribution is still potentially taxable on your tax return and whatever was withheld for taxes is simply given to you as a credit on your tax return against the overall tax liability calculated on your tax return. The plan making the distribution has no way to know the actual amount of your increase in tax liability that will result from you receiving this distribution since it is not determined until you prepare your tax return.
Forms 1099-R for some types of transactions are not permitted to have a zero in box 2a.
What is the code in box 7 of this Form 1099-R?
Is the IRA SEP/SIMPLE box marked?
