The 1099-r causes my refund amount to significantly decrease. I removed the Federal Income Tax Withheld to see what it would do and the refund goes up. Any idea why?

[NCperson]

if your marginal tax bracket is higher than what was withheld when you took the taxable distribution,  you owe more now.   

let's say, upon distribution, the administrator withheld 10% of the money for federal tax.  But you find yourself in the 22% tax bracket.   that would mean you owe more tax than was withheld. 

[SteamTrain]

Or..maybe you are mis-reading the "Refund" monitor

...and it's really a "Balance Due"...and the Balance Due amount increased.