Thanks for the response @ReneeM7122. I followed the steps and I don't get the error check anymore. But now there seems to be another issue. On Schedule CA (540) line 22, Columns A, B, and C now show $300 each, and Line 23, Column C amount has been reduced by $300. The error I think is when this amount gets transferred to Form 540 line 16, where the amount shown is the full amount without the $300 reduction (which I think is the correct amount to show on 540 line 16). I think what needs to happen is that the $300 should not be populated on Schedule CA (540), line 22, Column C, as CA does not allow this deduction and hence there should not be a state adjustment by the addition of $300 in Column C to further reduce my taxable income. Not sure how to resolve this issue.
