Thanks as well for the clarification. In the end all calculations turn out correct. What remains confusing for CA filers who take the questions literally are the misleading references to "employer contributions" on Schedule CA, reinforced by TTax in the "Learn more" "Tax Guidance" pop-up under the HSA line in "What income CA handles differently", which reads:
"What should I know about contributions to a Health Savings Account (HSA)?
If your employer contributed money to an HSA on your behalf, that contribution is not taxed by the federal government. However, California considers it taxable income."
It should read: IF YOU OR YOUR EMPLOYER...
I should have titled the initial post "Misleading explanation" as opposed to "Incorrect treatment". Thanks again for the responses.
