Simply importing the W-2 is insufficient. You must always answer questions about the W-2. In this case, the amount present in box 11 causes TurboTax to ask if the distribution was from a nongovernmental 457(b) or a nonqualified plan, to which you must answer Yes, otherwise TurboTax will treat the distribution as compensation which supports an IRA contribution. Had you answered Yes, TurboTax would have not treated the box 11 amount as supporting compensation.
I don't know why TurboTax even asks this question since amounts in box 11 are only supposed to be from these types of plans. Perhaps the use of box 11 was different many years ago and the question being asked by TurboTax is vestigial. This would not be the only place in TurboTax were an unnecessary question is asked that results in problems if the user gives anything other than the only possible correct answer. It's also possible that this question is present in TurboTax because employers sometimes misuse box 11, but if that's the case the employer should be asked to provide a corrected W-2. It's seems problematic that TurboTax would have a mechanism to allow the box 11 entry to be ignored.
