Report it in the 1099-R section:
1. Click Federal
on the left-hand side menu.
2. Click Income
across the top.
3. Scroll
down to Retirement Plans and Social Security and click Show more.
4. Click Start
or Revisit by IRA, 401(k), Pension Plan Withdrawals (1099-R).
You should have code 6 in box 7. That makes it non-taxable.