After talking to the support person for 45 minutes, we finally figured out this issue.
Once the date of death is inputted, the net capital loss appears on line 12700 as a negative. It does not populate line 16 therefore it is not taken into consideration on line 23600 Net income. However the net capital loss is included on line 26000 Taxable income. There is no indication that the amount is applied but if you calculate the difference between line 72 and taxable income line 74 (26000) the amount is the net capital loss.
