You may have conflicting answers to the questions about whether you are a business that qualifies for the QBI deduction that is reported on Statement A. You can see if you do in forms mode on your 199A Act Wks. If the answer to "Is this activity a qualified trade/business" is No and the answer to "Specified Service Trade or Business" is Yes it will cause this error.
To correct this you need to:
- Within your return in step-by-step mode, click the Federal Taxes tab.
- Choose the sub-tab Other
- Answer the questions until you get to the Is this Qualified Business Income?
- Change your answer to Yes, this income is QBI.
- Click Continue and answer the questions through the rest of the "interview".
- Complete the Federal Review.
This automatically corrects your issue on your Statement A and populates your K-1 correctly.
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