You should NOT use your W-2 withholding amount for the other State tax credit. It's not the tax paid to CA, it's an amount withheld but you may get some f it back from CA or you owe more in CA. You prepare the CA return first, then, when you do CO, the program will automatically transfer the correct numbers to CO. The note about credits and estimated payments is telling you not to change the amount calculated by the program.
