Get your taxes done using TurboTax

You read correctly. Because you didn't previously report the payments as income, you can't deduct the repayments.

When you’ve had to repay more than $3,000 that you had included in your income in a prior year, you may be able to deduct the amount, or take a credit against your tax, in the year you repaid the income.  See Repayments in Publication 525, Taxable and Nontaxable Income for more information.

To enter your repayment information in TurboTax Online:

1. If you’re on the Hi TurboTax Client, let's keep working on your taxes! screen, click the Pick up where you left off button
2. Click Federal in the left pane, if you’re not already there
3. Click Deductions & Credits in the banner
4. Scroll down and click Show more to the right of Other Deductions and Credits
5. Click Start to the right of Other Deductible Expenses
6. Proceed through the screens until you get to the Did you have any of these less common expenses? screen.  If your repayment amount was $3,000 or less, answer Yes.  Otherwise, answer No.
7. On the next screen, Did you have any of these other expenses?, answer Yes if your repayment amount was over $3,000.
8. Report your repayment amount in the Claim of right repayment over $3,000 box, then select Continue at the bottom of the screen.

See also this thread for more discussion on this topic.