Using 1.3M as average balance in calculation, federal return would allow 1/1.3 of total interest to be deductible, and supposedly California return would allow 1.1/1.3 of total interest to be deductible.
line 8 column C is part of CA form 540, mentioned in CA form 540 instructions in the link I posted. It says write the difference in column C which will add onto CA deductible.
The worksheet just calculated a higher deductible amount, but that amount or the difference isn’t used anywhere else in my return.
