If I paid state and federal taxes on my distribution to purchase a home, why does it tell me I have a tax bill?

[DoninGA]

A distribution from where to purchase a home?  Was this from a retirement account and you received a Form 1099-R for the distribution in 2022?

[xmasbaby0]

The tax that was withheld from the distribution you took from your retirement account was only an estimate.  Just like when you have tax withheld from your paychecks---it is an estimated amount of tax.   Then you have to enter everything onto your tax return to have your total income and total tax liability reconciled.  

Did you take money out of an IRA?  What kind of retirement account did you take money from to purchase the house?  If you took it out of a 401k you are subject to the early withdrawal penalty.   If you took it from a traditional IRA then make sure you enter it correctly into the software and answer the questions to indicate that the distribution was for the purchase of a home.