I withdrew money from my IRA to purchase my first home, where do I indicate this on my return so that I am not taxed?

It will be taxed but if you are under 59 1/2 you can avoid the 10% Early Withdrawal Penalty on up to $10,000.  Here are my old notes,  hope they get you there.....

The questions about exceptions to the penalty do not come after entering the 1099-R. Rather, you will see that area after you have finished all the Deductions and Credits section.

To enter the exception, starting from the "Federal Taxes" tab, select "Deductions & Credits". Select "Choose Explore on my own or I'll choose what to work on ." At the end of the Deductions & Credits section, select the "Done with Deductions" button. After several screens (depending on what entries you've made) you will come to the “Penalty May Apply” screen. Here you can pick the exception.

You can also go to the section under:
Federal Taxes,
Other Tax Situations,
Additional Tax Payments,
Extra Tax on Early Retirement Withdrawals

Are you sure  you  withdrew from an IRA account and not a work 401k or something?  The house exception is only for a IRA.   What  code is in box 7?  Is the little IRA box checked?  

Withdrawals from a traditional IRA are always taxed, because the original investments were not taxed.  If you are a first time homebuyer (under the meaning of the law), you can get an exception to the 10% penalty for early withdrawal under age 59-1/2, but only on the first $10,000 of the withdrawal.  (The withdrawal is always subject to income tax, and anything over $10,000 is subject to the penalty as well.)

Withdrawals from Roth IRAs may not be taxable at all (depending on the account history, we can discuss that in more detail if you want). If your withdrawal is not subject to tax, you might not be asked about penalty exceptions because the exception is not needed. 

Other retirement plans are not eligible for the first time homebuyer exception, and a 401k or other workplace plan is not an IRA.  They have different laws and regulations, even though they have a similar purpose.  If your 1099-R does not have the right code for an IRA, then Turbotax won't offer options that only apply to IRAs.  You might have a different kind of plan, or you might need a corrected 1099-R.