@samgrif Whether this TT error leads to any audits or not, why can't TT take 10 minutes to fix it? Despite your admittedly heroic efforts to analyze all the related IRS instructions, and the impressive mental gymnastics to rationalize TT's result, the fact remains that the gross amount displays as less than the taxable amount on the 1040. Any six grader knows that can't be right.
Apparently, the TT folks would rather spend the next two months trying to convince more and more people that this obviously nonsensical result is actually somehow correct, or not really a problem, than to just fix it.
A simple fix can be made in TT's worksheet "1040 WKS". If you right-click on Line 4 (Pensions and Annuities) of that sheet, you'll see that its data source is Line 25 of the TurboTax worksheet named "1099-R Summary". If you have a fully taxable Pension amount on Line 25 of the "1099-R Summary" sheet, Line 4 of 1040 Wks sheet doesn't pick it up, even though that is its "data source". Fixing that link gets a sensible result for multiple distributions, some of which are fully taxable while others are not.
