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Hi and welcome to Just Answer!The distribution code "L" on form 1099R means "L-Loans treated as deemed distributions under section 72(p)."
Yes that is your taxable income - and will be added to your other taxable income.
Your actual tax liability will be determined when you prepare your tax return based on your total income, filing status, deductions, etc. You will report these amounts on the form 1040 - www.irs.gov/pub/irs-pdf/f1040.pdf
line 16a - total distribution - from 1099-R box 1
line 16b - taxable part of distribution - from 1099-R box 2a
line 61 - federal income tax withheld - from 1099-R box 4
and it may be subject of an additional 10% penalty if you are below 59 1/2 - in this case - please be aware that there are certain exceptions to this additional early distribution penalty. If you qualify - you will claim an exemption on your tax return. Please see here some details - http://www.irs.gov/taxtopics/tc558.html and verify if any may be used in your situation.
I suggest to look for possible exceptions from penalty - see form 5329 - http://www.irs.gov/pub/irs-pdf/f5329.pdf - line 2 - Enter the appropriate exception number.
Let me know if you need any help.