You enter state information regarding the taxability of your pension distributions largely in the federal section of TurboTax, on screens you will see after your complete the form 1099-R entries as you see here:
You may not be able to designate the pension as taxabe or not taxable in the state program, you may need to do that in the federal program. I suggest you go back and review your form 1099-R entries and approach their treatment as taxable or not on your Michigan return by looking at your entries in the federal portion of TurboTax.