You will get a 1099R for it showing the gross amount and any tax withholding taken out. The gross amount will add to your total income and may push you into a higher tax bracket. And if you are under 59 1/2 there is an extra 10% Early Withdrawal Penalty.
You don't actually pay the tax on the withdrawal or the 10% penalty (you pay a 10% early withdrawal penalty if you are under 59 ½). You have taxes withheld like from your paycheck. You still have to enter the whole gross amount (before taxes were withheld) with your other income to figure out the total tax (and it may put you into a higher tax bracket and can reduce any credits) and then the withholding is subtracted from the total tax to figure your refund or tax due. The Gross amount shows up on 1040 line 5a and the taxable amount on 5b. The withholding will show up on 1040 line 25b.
It has to break out and show the 10% penalty separately on your return (schedule 2 line 8 which goes to 1040 line 23). Then you get credit for all the withholding taken out on 1040 line 25b.
