No. That question is to determine QBI, which probably does not affect the state return. If you receive a 1099-MISC from your employer, the IRS presumes that the income received should have been paid as wages and therefore not qualify for a QBI deduction. This is why you are seeing the IRS refund decrease because the 20% QBI deduction is being disallowed.
However, most states do not recognize the deduction, so this Federal adjustment does not affect the state return.
However, if you were paid on a 1099-MISC when you were actually an employee, you should not pay self-employment tax on this income either. You would pay 1/2 of social security and Medicare tax, and the company you worked for would have to pay the other 1/2. To claim this would require you to file Form 8919. To do this, click on the following link and follow the instructions provided by TurboTax Agent ChristinaS: https://ttlc.intuit.com/questions/3658376
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