It is not taxable. You can delete or leave it; it is not on your tax return. Since you did you tax return on TurboTax last year, the amount of your state refund was automatically carried over from last year. Once you tell TurboTax you took the standard deduction, that income is marked not taxable. It will stay on your summary screen, but not on your tax return.
To verify, print or preview your return and see if you have Schedule 1 with an amount on Line 1. Since your refund was not taxable, that line will be blank.
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