Yes. The distribution from your 401k will be included as income on your return and taxed accordingly. The 30% tax was only a withholding of Federal income tax, just like tax withholding from your paychecks would be. It is only when the income is included on your tax return that the income tax and withholding amounts are reconciled to determine if you get a refund of some of the withholding or owe additional taxes.
Having taxes withheld from a 401k distribution is not a stand-alone transaction. It has to be included on your tax return as well.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
