The "This is an ESOP distribution" checkbox is a vestigial checkbox that should have been removed from TurboTax 11 years ago. Prior to 1990, Form 1040A did not support the reporting of retirement distributions, so in 1985 the IRS allowed ESOP distributions to be reported on Forms 1099-DIV to avoid forcing those who would otherwise use Form 1040A from having to switch to Form 1040. The IRS permitted this alternative reporting of ESOP dividends on Form 1099-DIV through the 2008 tax year. Beginning with the 2009 tax year, the IRS no longer permits the payers of ESOP dividends to report the distributions on Form 1099-DIV.
See IRS Announcement 2008-56: https://www.irs.gov/pub/irs-drop/a-08-56.pdf
