Step by Step says that it is not taxable.
rgaylortx, this suggests that that the form 1099-R has code 2 in box 7 and TurboTax is simply telling you that the distribution is not subject to "additional taxes," referring to a 10% early-distribution penalty which is a type of excise tax, but I'm not sure if code 2 is really what you have.
If this distribution is instead a distribution that was intended to be an RMD and was reported with code 7, delete the Form 1099-R again, reenter it, indicate that none of the distribution was an RMD (the distribution ceased to be an RMD with the enactment of the CARES Act), then indicate the rollover.
