NJ Nonresident pension exclusion issue

First, I'll note that I had already marked NJ as non-resident but oddly, no NR state allocation worksheet shows up. This happens sometimes and I'm never sure why. 

However, on the NJ allocation worksheet I had marked only the NJ 20k CG as NJ source income. Nothing else is so marked. See screenshot for illustration. However, note that the line for "pension and IRA distributions" directs you to see IRA/pension worksheet. The pension auto-populates on this worksheet, but there is no way to exclude it as out of state income. You can mark it not taxable, but this just changes line 28a to 0 and gives the maximum of 100k exclusion on 28b. Otherwise she gets the full pension excluded on 28a and the remainder of the 100k exclusion is taken on 28b. This is incorrect either way, as a non resident, she isn't entitled to any exclusion whatsoever. 

Also, I notice above you put 64 y/o, I may not have made this clear, the spouse pension recipient is over 65. So because their income is under the threshold, she'd be eligible for both exclusions were they residents, the issue is they are not. 

I am also uploading a photo of the relevant portion of 1040NR to illustrate the issue again, so we are on the same page. 

Finally, thanks for mentioning the NR withholding tax, I'm well aware of it - that's the only reason this return was filed! 

Thanks again for your feedback.