I hadn't considered that Form 4852 does not explicitly provide for correcting box 13 markings. Yes, you would need to note the reason in box 10 of Form 4852 and enter the W-2 without marking the box on TurboTax's form. Simply leaving the box unmarked without any explanation would trigger a deficiency notice from the IRS since they would otherwise defer to what the employer reported. You'll need to be clear that the employer has never allocated any money to your wife's defined contribution plan (401(k)) and does not provide any other retirement plan.
