Yes, 1099-R income is generally taxed by states; however, some states have an exclusion for all or part of retirement benefits. Be sure to review your state return to see if this is available.
Information flows from the federal return to the state return. TurboTax's software is programmed to follow all the federal and state tax laws. If your retirement income is not taxable in your state, then it will not be taxed on your state return.
To enter your retirement income, Go to Federal> Wages and Income>Retirement Plans and Social Security>IRA 401 k) Pension Plan Withdrawals to enter your 1099R.
