You do exactly what you planned to do. Your state tax payment is not being taken out of your federal refund. There is no way to do that. TurboTax shows you a summary that illustrates the net result of your federal and state tax returns combined, but they are not actually processed that way. They are completely separate. You will get your full federal refund, and you still have to pay the state separately.
No, you misunderstood. That's not possible. You might have had the Turbo Tax fees deducted from your refund.
The state tax can not be deducted from the federal refund. NEVER. You can only have the Turbo Tax fees deducted. You will still get the full federal refund minus any fees you had deducted. Turbo Tax just shows you a screen at the end showing the Net amount of federal and state combined. But it is just for your own info. You do still have to pay the state yourself separately. See,
Check the printout or PDF of your return; look for the state cover sheet with the Turbotax logo. If you owed tax, it will show the payment information and how/when you decided to pay. Read the state payment instructions carefully since most states cannot be paid from within the TT system and requires additional steps.