"This results in my short term capital gains being taxed as normal income in federal."
A somewhat pendantic correction here, but maybe relevant; you had no short term capital gain. The sale created compensation that gets taxed at ordinary tax rates, and the compensation gets added to your basis for reporting the sale. Accordingly, a "same day" sale - which I'm guessing this is - typically shows a small loss due to selling commissions and fees. So I'd think that the ($11) that's coming over from the federal income tax return is exactly what's been reported on Form 8949.
If it's really the tax "rate" on STCG's that different than the ordinary rate, I'd think that TurboTax would simply move the transaction over to the state form "as is" and the program would then apply the different rate. That looks to be what it's doing here.
I know nothing about Massachusetts tax law, But my impression is that most states simply conform to federal law in this area. If Massachusetts doesn't tax the "spread" at the time of the sale as compensation but instead treats it as capital gain, then I'd think you would need to adjust that ($11) figure for Massachusetts. That would be offset - dollar wise if not tax wise - by a reduction in reported Massachusetts compensation. Has that happened?
Tom Young
