No. It is only for the earnings that you had to report as income on your federal tax return for a 1099-Q issued in your name.
When you entered the 1099-Q on the federal return, you had box 1, which is the distribution, Box 2, the earnings,and Box 3 which is the basis (your contributions).
After you entered any education information you had, the program calculated how much, if any, of the distribution you had to claim as income. This question is asking for that amount. (if you used a 1099-Q issued to your dependent in order to allow the program to make the calculations, the income, if any, would be reported by the student, not you.)
Illinois will tax you on the entire earrings (Box 2), so the program needs to subtract what is already in your income.
For example, if there was 500 in box 2 and you had to claim 200, you would answer 200 and Illinois will add 300.
If there was 500 in box 2 and you did not need to claim any of it, you would enter 0 here and Illinois will add 500
The Illinois return will only add the earnings for the distribution that is not included in the federal income.
According to the State of Illinois:
Line 3
Other additions
Complete Schedule M if you have any of the following items:
earnings distributed from IRC Section 529 college savings and tuition programs and ABLE plans if these earnings are not included in your adjusted gross income, Line 1"
https://www2.illinois.gov/rev/forms/incometax/Documents/2016/individual/il-1040-instr.pdf
