why is my roth distribution labeled as income

It has to do with how you answered the questions after you entered the form. Go back and edit the 1099-R. The distribution should be a mix of basis and earnings. 

A qualified ROTH withdrawal has several requirements to be tax free:

• A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements.
• It is made after the 5-year period beginning with the first tax year for which a contribution was made to a Roth IRA set up for your benefit.
• The payment or distribution is:
• Made on or after the date you reach age 59½,
• Made because you are disabled (defined earlier),
• Made to a beneficiary or to your estate after your death, or
• One that meets the requirements listed under First home under Exceptions in chapter 1 (up to a $10,000 lifetime limit).

All distributions from retirement accounts are classified as income.   That just means that the distribution is required to be reported on your tax return.  What matters is whether or not the distribution includes taxable income.  For a nonqualified Roth IRA distribution, the taxable amount is determined on Form 8606.  Qualified Roth IRA distributions are always nontaxable.