My client has rentals with material participation so no passive income. Combined with Depreciation the rentals are net loss. When I transfer data to California 540 the CA Adjustments (540) Section B additional income from Fed Schedule line 5 Rental real estate etc.. under column Fed = a negative number or a loss (non Passive). However under the state adjustments for California it treats the Federal loss as non-passive and does add the Federal loss to CA income. What am I missing. This has never been a issue in prior years? Thanks