From Dr. Claude Steiner’s web page:

TRANSACTIONS; COMPLEMENTARY, CROSSED AND COVERT. Transactions occur when any person relates to any other person. Each transaction is made up a stimulus and a response and transactions can proceed from the Parent, Adult or Child of one person to the Parent, Adult or Child of another person.

Complimentary and Crossed Transactions. A complimentary transaction involves one ego state in each person. In a crossed transaction the transactional response is addressed to an ego state different from the one which started the stimulus.

Communication can continue between two people as long as transactions are complimentary: Crossed transactions are important because they disrupt communication. This is useful to know because it helps transactional analysts understand how and why communication is disrupted. The rule is: “whenever a disruption of communication occurs, a crossed transaction caused it.” One very important kind of crossed transaction is the discount transaction. Here a person, in his response, completely disregards the contents of a transactional stimulus. Discounts are not always obvious but are always disruptive to the person receiving them and if repeated can severely disturb the recipient.

Covert Transactions. Covert transactions occur when people say one thing and mean another. Covert transactions are the basis of games and are especially interesting because they are deceptive. They have a social (overt) and a psychological (covert) level.

It is important to know the difference between the social and covert levels because in order to understand and predict what people are going to do, the covert level will give provide more information than the overt level.

One important reason we say one thing and mean another is that we are generally ashamed of our Child’s or Parent’s desires and feelings. Nevertheless, we act on these desires and express those feelings while we pretend to be doing otherwise. For instance, we may use smiling sarcasm instead of a direct expression of our anger, or when scared we may counter-attack instead of admitting our fears.

When we want attention or love we often feign indifference, and we have trouble giving or accepting them. In fact, because our lives are so immersed in half-truth and deception it can happen that we no longer know what it is our Child really wants. We also don’t expect people to be completely honest so that we never really know whether we can trust what they say. Transactional analysts encourage people to be honest with one another, and with themselves, about their wants and feelings, rather than “crooked” and covert. In this manner people can find out what they want, how to ask for it and, if possible, how to get it.