1099-g

I have a simple NJ return. Last year I received a state refund of $123. The amount in box 17 was $123.45.

This year the amount in box 17 is $161.52 which was rounded up to $162. Turbo tax keeps auto-adding a 1099-G form with the $123 and when i see the breakdown, it shows the $123 as taxable income and is being deducted from the $162, which gives me a state refund of $39. I chose the standard deduction. When I looked it up, it said if i chose standard deduction in 2024, my state return should not be considered taxable income but it seems that it still is being considered taxable income. I have completely cleared the form and reentered all my information and nothing changed.

Can anyone tell me if this is correct or not? and if not, how do i fix it?

posted