Yes, you need to report that you received an exception to the tax penalty to TurboTax. The 1099-R that you received from your 401k distribution should indicate this by having a Code 2 in Box 7. Box 7 can be coded with a 1 which applies the 10% tax, or Code 2 which indicates an exception to the 10% tax so that the withdrawal is not taxed at 10%. See Page 15 in the following link for information about the codes. 1099-R Forms
{Edited 1/21/2021 11:11 PST}
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