Apparently the financial institution treated it as a rollover rather than just share transactions within the IRA. You will have to enter the 1099-R on your tax return and unfortunately the amount of the federal withholding will be treated as a distribution and is taxable. There was apparently a misunderstanding between you and the financial institution about what you were trying to do. Rather than take a distribution you should have had a direct rollover of the full amount to the other stock. To be a rollover, you had to reinvest the funds within 60 days of when you took the distribution.
When entering the amount of the rollover, you can only include the amount rolled over less the amount of federal tax withheld unless you invested funds from another source to make up the difference.
