To assure your piece of mind, contact the issuer of the K1 form and ask why Box 16 was checked. The entries in Line 20 on your K1 does not suggest that this is from foreign income sources.
Based on the exceptions listed, it sounds like you qualify for an exception but still inquire about a specific reason why the box was checked. This is because in the mail, you said "It also says that Schedule K-3 is not required to be attached to my U.S. federal and state tax returns". Yet the box was checked that you have a K3 attached to the return.
There is a conflict of information here that needs to be clarified by the partnership that issued the K1.
@raybeyond
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