I finally figured out why I was getting an error message. For the K-1 with rental income, in Part III, I checked the rental real estate box and I put 0 in line 1(which is ordinary business income) and I put the real loss amount in line 2. And both lines gave me an error message. Instead of putting 0 in line 1 I erased and made it blank. Once I made it blank, both error messages went away. So you can't have any entry in line 1. If you do you will get an error message.
