Turbo tax made a "stealth" update and added a question to the California question/income section to cover this special difference.
If you haven't filed already, you can now just review the California income section and enter the "ending" ballance of these 1098 interst paid forms and the calculation comes out right.
BUT I'M SCREWED, because I filed already, and now I cannot create an AMMENDMENT to change and fix this with the state!!
