The IRS letter is for 2020, saying you owe tax on the full amount, You have the 8915-E in your return. There should be a page to say you disagree with the IRS and send them a copy of the 8915-E with the section highlighted.
TurboTax has a special phone number for help with tax letters. Click on the blue button that says "Get help from TurboTax support" after you click here. You will also want to visit the IRS website for notices, click here.
Reference: About Form 8915-E, Qualified 2020 Disaster Retirement Plan Distributions and Repayments (Use for Cor...
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