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The federal NOL is added back to your CA AGI because a CA NOL is a separate item that usually differs is value from the federal NOL. On form 3805V, page 3, you will have your CA NOL that has carried forward from previous years. You can use up to the amount of the modified taxable income (MTI) on the same page. Use this value on Sch CA, line 21d to subtract this from your AGI. Sch CA, line 21c is where the Federal NOL is added back. Please let me know if you have any questions.
This appears correct as your CA NOL is limited to your MTI.