Yes, I think you are conflating this distribution with the rollover to an inherited IRA of a separate account that had been an account in an employer plan. Code 4D indicates a distribution from a nonqualified annuity paid to a beneficiary. Nonqualified annuities are not permitted to be rolled over, so the code-4D Form 1099-R simply represents the payment to you of your share of the nonqualified annuity. The taxable amount is the amount shown in box 2a and the nontaxable amount (the investment in the contract) is the amount in box 5.
The tax treatment of a distribution from a nonqualified annuity is the same whether it is a total distribution or a not, so it really doesn't matter which way that you enter the form to satisfy TurboTax. The IRS Automated Underreporter System is just going to check to see that the amount from box 2a of the Form 1099-R is included on Form 1040 line 5b.
