How does one use tcpdump to capture incoming traffic?

The most reliable option is to use the -Q option as follows:

$ tcpdump -Qin other filter logic

The -Q option may not be supported on all platforms, and an alternative is to use equivalent logic in BPF (Berkeley Packet Filter) syntax, in the form of the inbound and outbound predicates:

$ tcpdump inbound and other filter logic

However this typically requires a couple of packets to be processed to determine the directionality, and tcpdump may not capture those initial packets; the -Q option does not suffer from this drawback.

Note that both these options treat all packets on the loopback interface as inbound: for such packets, there is no sense of direction as the source and destination addresses are the same, and so it is somewhat arbitrary as to whether to view them as inbound, outbound, both, or neither. Both these options are consistent in viewing loopback packets as inbound only; in particular, neither tcpdump -ilo -Qout nor tcpdump -ilo outbound will capture any packets.

Related

Blog: Cloudy with a Chance of TCP Drops