593-C FTB & Federal

[Aaron J.]

I'm an individual selling my condo. We have only lived here for 14 months. I've been told by my escrow company that California is going to take 3.33% of the sale of my condo as a withholding because we have not lived there for 2 years or more. (I find that so arbitrary btw.) 

I have reviewed Federal 2015 Publication 523 (https://www.irs.gov/pub/irs-pdf/p523.pdf) to see if I have a qualifying circumstance but I feel like I need a tax attorney to confirm if my circumstances apply or not. I feel my circumstances can be argued either way. I see that if I choose not to withhold and later found to be a mistake, then I am liable for 20% penalty plus interest, fees. ETC. So....  

My questions are...

1. Can the CA withholding be avoided some other way that is not listed in the publication? 

2. If the state of CA withholds 3.33%, how much will Federal withhold? Or is CA acting on behalf of the federal as well? 

Thanks for your input.