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Retirement tax questions
According to the IRS instructions, rollover contributions are NOT considered eligible contributions. At the time that you made the original contribution, it would have been an eligible contribution so it would be like using the same contribution twice for this credit. Please refer to line 1 of page 1 of the IRS instructions. https://www.irs.gov/pub/irs-pdf/f8880.pdf
However, with respect to your contributions that are eligible for this credit on your 2016 tax return, they are NOT reduced by the amount of this same rollover distribution. Please refer to page 48 of Pub 590A under the heading, "reducing eligible contributions" where it says, "do not reduce your eligible contributions by any of the following...." https://www.irs.gov/pub/irs-pdf/p590a.pdf