It was the federal early-distribution penalty on the taxable portion of a code PJ distribution that I addressed recently. A far as I know, California is the only state with an early-distribution penalty.
I don't see any reason why TurboTax would include in NJ income any more of the amount on a code PJ Form 1099-R than is included in income on the federal return. To appear in NJ income, any amount beyond the amount in box 2a of the code PJ Form 1099-R would have to be an addition to federal income and I can't see TurboTax doing that, but I don't have the NJ module to test with.
