Was the CD in a another qualified account, that is, is it in an IRA? Or were the funds simply put into a non-qualified bank account earning a higher interest? If the latter is true, the entire distribution would appear to be taxable in 2009 along with a premature distribution penalty of 10% applied to the entire amount of the funds that were distributed from the qualified accounts.
The reason is that "the IRS imposes this penalty to deter individuals from taking premature distributions from their retirement accounts."
I am hoping that you transferred the retirement funds into another qualified fund that was an interest bearing fund. But, if you did not, you might still qualify for an exemption of the premature early distribution 10% penalty if you meet the IRS exception rules.