<p>Hopefully the state tax people (for whatever state) have better phone help than the IRS. The IRS hold times are outrageous, and you’re lucky after holding if you get someone who knows what they are talking about.</p>
<p>Anyway, for the OP, maybe it’s as simple as this: when you file your son’s CA taxes, deduct the NY source income (scholarships) from federal AGI. When you file the NY taxes, deduct from federal AGI everything but the NY source income (scholarships).</p>