Came here to see if this was an issue with CC or me. Looks like a little bit of both. For those who are interested, the work around is to: Use the design tab and go to "Fonts" to set the styles for your H1, H2, H3, and P tags. Make sure all your text is labeled in each block with these tags. Now, when you paste outside text into the block, your text should take on the destination style of the tagged content. The trouble is, we need more options (Full H1-H6, and multiple P styles like display P, body P, bold P, or similar), and we need them to link up with the names in the "Design" tab. How do I know that a Heading is H1 or a Feature Heading is H2, etc.? The labeling needs to be changed or amended in the text editor and/or the Design tab to be consistent with one another. For example, you could simply write "Header (H1)" in the design tab, and people would understand the correlation between the text editor and the design tab. Hopefully this helps others having this issue. And I hope CC can make these very small changes to make the interface more user friendly.
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