Vacation rental. For CA, why is unused mtg interest (from vacation rental loss) backed out on CA 540 adjustment? Not in previous years.

[craighochhaus]

I own a vacation rental.  Since my expenses exceed income, the unused mortgage interest has always transferred to federal schedule A line 8a for itemized deductions. For 2018, the unused interest is backed out on CA 540 adjustment page 2, column C.  It was not deducted in previous years. Why in 2018?

[KatrinaB]

There is a limitation on business interest due to the Federal Tax Reform. Please view my answer below for more information about this California law. 

https://ttlc.intuit.com/replies/7356102