ERROR with CA charging additional tax on interest from Return of Roth IRA contributions before deadline

Request your confirmation on entries below, why the error is coming up and how to fix it.  Thank you.

Context:

I had contributed $7k to Fidelity Roth IRA in Jan 2024 but realized that there is income limit as my salary increased to > $150k in March 2024. It had earned interest of $801.85.

I submitted Return of Excess contributions to Fidelity and got back $7,801.85.

I was New York resident for all of 2024, though I lived in CA until end of 2023. So I downloaded both New York and CA for TurboTax and am filling both sections. I entered 1099-R for Federal section which then had below:

"Did you use your IRA to pay for any of these expenses?" screen: "Corrective distributions made before the due date of the return": $802

Question:

California section has below. Please confirm if I should leave it as is, should I check the box that "My distributions are not subject to additional tax?" I understand if I owe the tax on the interest of $802.

Screenshot 2025-03-15 at 6.25.58 PM.png

Should I change that to below?

Screenshot 2025-03-15 at 7.10.11 PM.png

If I don't do that, I get additional taxes and errors below

Screenshot 2025-03-15 at 6.26.23 PM.png

ERROR

Screenshot 2025-03-15 at 6.37.48 PM.png

When I switch to Forms, it shows below in form 3805P. This should have been Yes, right? Please let me know what I missing. Thankyou.

Screenshot 2025-03-15 at 6.38.38 PM.png