During divorce, as part of the settlement, I was awarded a portion of a TSP (Thrift Savings Plan) account. I rolled most into my 401k, and cashed some out to pay divorce attorney fees (had tax withheld). Does this count as earned income and affect my Modified Adjusted Gross Income? I have a Roth IRA and now I'm not sure if I need to pull that money out to avoid a penalty. (I contributed to the Roth IRA after the divorce was final, but before receiving the TSP settlement.
