Yes, this is an error on their part. No pushback is needed. You can handle this by making sure that the income earned from the services performed is included in the total business income. Keep the document with your records to show how your total income was computed. If the IRS ever has a question you can provide documentation to show that it is included on the return. IRS's main concern is that ALL income is reported.
Again, just make sure to include it in income.
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