"Otherwise I am being taxed twice on this income, and that is not legal."
It's true that in October 2014, the US Supreme Court invalidated all state tax schemes that might lead to double taxation of out-of-state income - see this US Supreme Court link.
The problem is that in terms of local taxation, states are reasonably independent - who is going to make which state change their laws? It would take an act of the Supreme Court to do so, and who has the time and money to do that (often)?
So while in theory double taxation by states is not legal, the cure is a problem and not easy to attain. TurboTax has to abide by the states' laws and leave it to the legislatures and the courts to bring tax codes in alignment.
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