I have been thinking that Lacerte is calculating the California credit correctly here. And, I don't think California had the foresight to say the credit is not payable if the feds end up not charging for the fed overpayment. California felt that the income level at which people still get premium help should be higher than the amount the feds used. Now the feds are rewarding people who understated (not necessarily intentionally) what their income was going to be, and if their income is still in the California help range, well...

My original question was that it seems like the deduction taken for medical insurance premiums (whether taken as SE or on Schedule A) should be reduced by the California assistance, and it did not look like Lacerte was making this reduction.