I had this issue today. It was caused by making edits to the 1099-DIV.
Try first deleting the 1099-DIV completed in the federal section. Then recreate it, entering all information as explained by StreamTrain. That worked for me. When I did, Turbo Tax correctly took the one 1099-DIV from federal and split it into two for state: for the the in state piece (exempt) and one for the out of state piece (not exempt).
I agree it is a bug that you cannot edit the 1099-DIV without breaking it. It seems the only way to fix it is to delete it and start over.
Hope this helps!
