https://www.irs.gov/pub/irs-pdf/i8960.pdf
You are just reading the definitions listed in the beginning of the instructions which doesn't have anything to do with the line 13 instructions later in the document. The excluded income definition is used for calculating line 18b. If you use the Adobe Reader's FIND tool for "excluded income" you will see that only shows up 3 times in the entire document.
The TT program is really good at following the IRS instructions but if you still want to discuss this ...
Please use the following link to contact Customer Support for further assistance.
https://ttlc.intuit.com/community/using-turbotax/help/what-is-the-turbotax-phone-number/00/25632
