Is there an amount of state tax withheld in box 5? If state tax was withheld, you have to identify what state it's for. If the 1099-NEC has state tax withheld, and no 2-letter state abbreviation in box 6, the 1099-NEC is not filled out correctly. You can get around the error in TurboTax by entering the 2-letter abbreviation for the state. But if the state is not shown on the 1099-NEC form, it raises the question of whether the payer paid the tax to the state. You should contact whoever issued the 1099-NEC and ask for a corrected form.
The payer's state tax ID number should also be in box 6, but TurboTax will not object if the state number is omitted.
Thing must have changed because its currently not letting me proceed without the state # even though I have 0 withheld in box 5 but there is my state income listed in box 7. The payer only put the state abbreviation in box 6 but no #. Is there anyway to get pass this?
Use the number in the Payer TIN box - it is under the Payer address box. @kal2023