There appears to be a mistake in the descriptions for the codes in the 1099-R form, box 7. For example, code 8 refers to 2016 instead of 2017, and code P refers to 2015, not 2016.

[dmertz · Accepted solution]

2016 TurboTax's drop-down text assumes that your are entering a 2016 Form 1099-R on which code 8 means taxable in 2016 and code P means taxable in 2015.  If you are entering a 2017 Form 1099-R, 2016 TurboTax will later ask whether it is a 2016 or a 2017 Form 1099-R, answer appropriately.  TurboTax will then treat a 2017 Form 1099-R with code 8 as taxable in 2017 and code P as taxable in 2016.