If your soil is mostly clay, I would remove it from that location. If the water doesn't drain well and when your winter rain comes, the tree will drown. For the tree, it's like living in a pot without holes. I used to live in Sacramento and lost many fruit trees for that very reason. Your other option is to dig it up and break through all the clay until you hit good dirt which will drain better.

I noticed this problem with one of mine as well. I suspect the soil is not porous and airy enough. Do you have very dense clay-type soil?

The problem typically manifests itself in the Winters here.

There is nothing I can really do about the soil, minus add some more gypsum. Do you think I should remove the mulch aroun so it doesn’t retain the moisture?

It won't matter if you remove the mulch. If you get lots of rain, your tree will still be sitting in a pot like environment. Citrus don't like wet feet and develop root rot. I would also take it out of the grassy area where you use sprinklers. Another option is to put it elsewhere and raise it so the drainage is better.

How deep of a hole did you dig when you planted the tree?

In my northern ca heavy clay soil, its taken 1 to 2 years for the roots to get settled... depending on the rootstock. What have you fed the tree?

Thanks for all the info guys! The hole I dug was 2-3 feet deep, and I also put down some gypsum to break up the Clay. And I feed it fertilizer specified for Cirtrus and Avocado trees. I just gave it some fertlizer and we’ve Had a lot of rain so hopefully that will help the tree. But if it doesnt Improve, maybe poor drainage is the culprit.