As long as you don't live in a locality (city, county, etc) with a local income tax, it's a moot point. It's like living living in Texas, which doesn't have a state income tax and having your earnings reported in box 16 State Wages - they aren't taxable by the state. If your locality doesn't have an income tax, there's no additional tax on those wages. As far as a "glitch", TurboTax just imports the data provided.
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