No.  The concept is because the income is taxed on the 140-SBI tax return it is not considered taxable income on the normal 140.  So, that last bit of income is only taxed at 3.5% (if it is "small business" income) vs. at 4.5%.

1% doesn't make a difference for most of us.  But for those who are already in the 4.5% tax bracket, it likely will.  Even $10k of Schedule B dividends (not all that unusual for even a moderate income retiree) if reported on the SBI would save a taxpayer $100.