This should not be a state-by-state issue. If the IRS wants cap gains on discounted treasury notes and bonds re-characterized as interest then it is interest and no state can make a claim that its taxable. I fixed my issue by going to the underlying Turbo Tax interest worksheet for my state return and over-riding each entry issue description its amount by clearing them out to blank. I also clicked the pop up "+" and entered the reason for the override. Voila it all went away and the return passed review with no Turbo Tax flags.
