In most cases, you don't have to do anything in the California return with home mortgage interest - TurboTax has already made any needed changes.
Have you looked at your complete California return in TurboTax Online? You can do that if you have already paid for your TurboTax product. You can preview your return before filing to find out how your taxes were calculated. See here for details. Look at the Schedule A in the California return.
When you complete the California section in TurboTax Online, and you reach the screen, "Here's the income that California handles differently", one of the listed items, under Home, is Mortgage Interest Adjustment. The Learn More link next to that item states:
California does not conform to the new federal law that limits taxpayers to the interest on $750,000 ($375,000 for married filing separate) of home mortgage acquisition debt. California allows taxpayers to deduct interest on loans up to $1,000,000 ($500,000 for married filing separate). Additionally, federal law also limited the deduction on up to $100,000 for interest on non-acquisition (i.e. home equity) indebtedness, unless the loan was used to buy, build, or substantially improve your home that secures the loan. Important Note: This impacts loans originated on or after December 15th 2017. Loans originated prior to this date are grandfathered. In this situation, no adjustment would be necessary.
We've calculated the amount of deductible interest and points on acquisition debt, including the amount of the loan over $750,000 (but not over $1,000,000). In addition, the deductible amount includes any amount of non-acquisition loan interest you paid.
Why would I adjust my mortgage interest?
We have calculated your deductible California interest and points based on what's called the "Average of first and last balance method". If you paid your mortgage unevenly during the year, borrowed new amounts during the year, or would otherwise prefer to use another allowable method of calculating your interest, you may modify the mortgage interest adjustment.
If you have looked at your complete California return and there is NO mortgage interest on California Schedule A, please confirm.
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