"will TurboTax automatically apply the exception to the 10% early distribution penalty?"
No. The code J normally indicates that the taxable amount in box 2a is subject to penalty, so TurboTax normally treats it that way. In this case the code J when combined with the code 8 is simply used to indicate that the return of contribution was from a Roth IRA, so you must indicate that the amount in box 2a is exempt from penalty due to being part of a corrective distribution to prevent TurboTax treating it as being subject to penalty.
