I needed to replace the \r\n with actual carrige return and line
feed and replace \t with actual tab.

    public string Transform(string data) 
    { 
        string result = data; 
        char cr = (char)13; 
        char lf = (char)10; 
        char tab = (char)9; 
 
        result = result.Replace("\\r", cr.ToString()); 
        result = result.Replace("\\n", lf.ToString()); 
        result = result.Replace("\\t", tab.ToString()); 
 
        return result; 
    } 

The calling function:

textOutput.Text = Transform("This is the first line.

\\r\\n\\tThis is the second line.");