Cope the bottom like millworkman said. I would break the board behind the shoe mold somewhere else as well. Breaking right on top just makes it more obvious.

The transition pc should have been cut to fit the baseboard...shoe molding

Looking at this again, I believe there is a step down in elevation where the T-mold is located. What a screwed up issue to have to deal with...

"I have transition step, about 1/4"

Thats why I suggested coping the trim and you cope it unevenly............

Fixing that problem is much greater than just making that area look seamless. The problem is that the same base molding is being used for two different floor heights. That means the only way to solve the problem is to trim the difference(1/4") off the bottom of the base on the right to get the top of the base molding even. That means redoing all the molding in the room on the right.

Another option would be to add the 1/4" to the bottom of the base molding on the left and adding to all the base molding on the room on the left.

To make a seamless joint using painted trim, a scarf joint is used. That is a 45° angle joint cut in the end of a piece of trim, the opposing 45° cut on the joining end and the two joined with glue(and finish nails).

To make that transition, a piece of the molding needs to be cut about 6" long. Using a multitool or Dremel, the notch is formed and the right side trimmed to the height of the trim on the right on the bottom of that side or the trim on the left is added to to equal the height of the trim on the right.

That matches the top and middle trim profiles and the gap matches the transition strip.

Then, cut the scarf joints on each end of the new transition section and remove the base molding on each side. Install the new piece and cut the corresponding scarf joints on the old base and reinstall.

When done properly, primer will cover and hide the joints.

Situations like this are what separates trim carpenters from molding installers.

Brian, have a trim man use a 1/2"x3" strip of wood. Measure the height difference between the 2 floors and trim down the 1/2"x3" on the higher floor so that the wood is flush in height all the way around the parameter of the island. Paint to match your island. Someone who specializes in trim work can do this.