Health Savings Account (HSA) contributions are before-tax for federal income taxes and before-tax for state taxes in all states except in California and New Jersey.
Question 1: California includes HSA contributions into taxable income. Federal taxes excludes those contributions from taxable income so California has to add them back.
Question 2: Why would you add $2000.00 back. It has already been added.
Appears TurboTax has accurately computed total income for the California return.
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