I have not heard this issue before. I have the Turbo Tax desktop for federal and California state returns but I have used the online version in past years. Even though your initial run through did not generate enough deductions to make it worth while to itemize, you can go back and add new deductions or edit ones already entered. Turbo Tax is not going to stop you from doing that. Select the Federal Taxes tab and then Deductions & Credits tab then 'I'll chose what I want to work on'. But you should not need to if you have already entered all your possible deductions. Take a look at your California return for Schedule CA. This form should be included for your California taxes regardless if you itemize or not on the federal. This is the California answer to the federal Schedule A that shows the deductions from the federal with additions and subtractions for California.
