A rollover is not a contribution and they don't have the same limits. Turbotax treated the money as a contribution, and applied your $7000 limit.
Did you perhaps enter $10891 as a contribution to your wife's IRA? That would have given you a $7000 tax deduction and a large penalty. Removing the $7000 tax deduction would definitely cause your income tax to increase, although the amounts you cite seem larger than I would expect.
The $10891 should not have been entered as a separate contribution. The only place it should have been entered is with the 1099-R code G. Turbotax would either assume it was a rollover, or would ask you if it was a rollover and you would confirm that fact. You don't separately report any IRA contributions, because the rollover is not a contribution. As noted, however, we can't say for sure without seeing your return. No one on this board can see your return, but official customer support can see it if you share a token number.
