I took a distribution from a 401K and paid 30% taxes upfront. I've done this same thing in prior years and have never had turbo tax apply a 10% penalty on top of the 30% I already paid. It's always said "you don't owe any more money on the withdrawal" but not in this years version. I can't find anything that suggests the rules have changed with regard to this.... is this a glitch in TT?
You had tax withheld from the distributions from the retirement account, just like when an employer withheld tax from your paychecks. When you enter it all into the software, the calculations are done to reconcile the amount of income you received and the amount of tax that was withheld. You might owe more or you might get a refund.
How old are you?
There's a difference between taxes and penalties. If you are over age 59-1/2, or were over age 55 when you separated from the employer, you don't pay an additional penalty. But you always pay the income taxes.
The withholding is an estimate, your actual tax might be more or less, and is only calculated on your tax return after combining all your income, deductions and credits. If the 30% withholding covered your tax in previous years but does not cover your tax this year, maybe you have other income this year.