Smart Check: Home Sale Worksheet Link should be blank. Assets with disposition losses cannot be linked to the Home Sale Worksheet.

Hey experts,

 

I had a rental property which I sold in 2021. I am eligible for capital gain exclusion as per P523 as we have live for 3 years in the property in last 5 years. In smart check I am encountering this error "Home Sale Worksheet Link should be blank. Assets with disposition losses cannot be linked to the Home Sale Worksheet.".

If I delete the entry, then TurboTax is asking me to pay taxes on capital gains. I looked at other discussions of similar nature but I am not able to find a correct solution. Please help. 

 

Thanks!