Military retirement/pension income is not reported to you on a W-2. It is reported to you on a Form 1099-R. Military retirement/pension income is taxable on a federal tax return. The taxable amount is in box 2a of the 1099-R. Federal taxes withheld are in box 4. The federal taxes withheld are entered on your federal tax return as a tax payment.
The IRS is only concerned with a federal tax return, not a state tax return.
Only the user of the TurboTax software can enter the information from a W-2 or a Form 1099-R. If the tax data was entered incorrectly or in the wrong section of the tax return, that is not the fault of TurboTax.
Look at your tax returns from 2017 and 2018.
Form 1040 (2017) -
Wages from working are on Line 7
Retirement/pension income is on Line 16a. The taxable amount of the retirement/pension is on Line 16b
Total Tax payments payments from W-2's and 1099's are on Line 64
Form 1040 (2018) -
Wages from working are on Line 1
Retirement/pension income is on Line 4a. The taxable amount of the retirement/pension is on Line 4b
Total Tax payments payments from W-2's and 1099's are on Line 16
Use the TurboTax Audit Support Center to get assistance in understanding the letters or notices you received from the IRS.
Go to this website for the Audit Support Center - https://support.turbotax.intuit.com/irs-notice/audit-support/
