Thank you, Lisa. I reviewed the information. This is a Covid grant taxable on federal, not taxable by CA.

The link says:

S-Corporate:

1. Open the California return.
2. Open Form 100S p4-6.
3. Scroll down to the Schedule K on Side 6.
4. Enter the amount of the grant and description on the Other deductions line 12e in the CA Adjustment line.
5. This amount will be reported on the CA Schedule K, line 10b, column c.

The problem is 5, after I enter it as other deduction as explained under step 4, it does not flow to the K-1 at all as it says it would under step 5. It says: "This amount will be reported on the CA Schedule K, line 10b, column c." No, it does not flow to the K-1 at all. 

Any idea?