TurboTax has done it correctly. The LTCG goes on line 7 of form 1040 and becomes part of your AGI on line 11 and taxable income on line 15. The application of the 0% tax rate is shown on the "Qualified dividends and capital gains work sheet" (sometimes the "Schedule D worksheet"). In particular, see line 9 on the worksheet.
https://www.thetaxbook.com/updates/TheTaxBook/Client%20Tax%20Tools/2020_Qualified_Dividends_and_Capi...
