@douglasjia
<<Does NY just look at NY payments versus NY liability, regardless of CA credits?>>
That is correct. But you are confusing the credits; it has nothing to do with the situation.
NY determined the tax based on NY sourced income. It did not consider any of the money you earned in CA (other than the RSUs)
CA determined the tax based on ALL your income regardless of where it was earned. THEN it gave you a credit for taxes paid to NY.
What NY is stating is that you should have had more money withheld during the year payable to NY (or made estimated payments).
Since that didn't occur, they are charging you for underpayment. On the other side, CA doesn't pay you interest for over-paying the tax.
You might contact NY and see if they permit one-time waivers.
