Although Congress has considered changing this aspect of the tax code, it's true that, under present law, if you received a check from your mother's IRA payable to you as a non-spouse beneficiary, indicated by the fact that you received a Form 1099-R, the money was not permitted to be deposited as a rollover to an IRA, inherited or otherwise; the custodian holding the IRA titled as an inherited IRA should not have permitted you to deposit the check into any IRA as a rollover. Funds are only permitted to be moved from the IRA of the deceased to an inherited IRA for the benefit of a non-spouse beneficiary by nonreportable trustee-to-trustee transfer. Funds impermissibly deposited into the IRA constitute an excess contribution that is subject to a 10% an excess contribution penalty each year that it remains in the account.
TurboTax is programmed to know that a rollover of an IRA by a non-spouse beneficiary is not permitted, so it will not permit you to report it as having been rolled over. The distribution is taxable on your tax return. Unless you obtain an explicit return of excess contribution of these funds from the inherited IRA, you must report the contribution as a regular personal IRA contribution that will be subject to penalty to the extent that the amount exceeds the amount that you are eligible to contribute to an IRA of your own for the tax year (and somehow you'll need to convince the custodian of the inherited IRA that the permissible amount needs to be moved nonreportably to an IRA of which you are the participant, not as beneficiary, and to issue a corrected Form 5498).
If the check was actually made payable to the inherited IRA for your benefit and not made payable to you, the original IRA custodian issued the Form 1099-R in error. In this case you must contact the original IRA custodian to obtain a corrected Form 1099-R showing $0 distributed.
