PFL paid by the Calif EDD is reported on a Form 1099-G as TTWesley indicates, and is not included in your W-2 wages. If you indicated on your TT W-2 entry screen that some or all of the wages were PFL then that is an error and FTB is correct in disallowing the subtraction on your Calif return since your 1099-G PFL income has already been excluded from California income.
