DanaB27's replies have nothing to do with getting TurboTax to prepare Form 8606 Part III correctly to determine that taxable amount of your Roth IRA distribution.
On the page that list the Forms 1099-R that you have entered you must click the Continue button and proceed to where TurboTax asks you to enter your basis in Roth IRA contributions. Because, as you have stated, your basis in Roth IRA contributions exceeds the amount of your distributions, the calculation on Form 8606 Part III will produce a taxable amount of $0. Because the taxable amount is zero, the early-distribution penalty is also zero, no need to claim any penalty exceptions.
