The following e-file critical diagnostic is generating in Lacerte:
- Schedule C is not required when gross income, total expenses or net profit/loss are all zero. (ref. #587)
Follow these steps to clear the diagnostic:
- Go to Screen 16, Business Income (Sch. C).
- Scroll down to the General Information section.
- Enter a 1 in the 1=delete this year, 2=delete next year field field (code 100).
- The program will ignore this activity and won't generate a Schedule C.
If assets are tied to the activity a separate diagnostic will generate due to the now "missing" activity. Also, if prior year unallowed passive losses are entered for the business activity and a Form 8582, Passive Activity Loss Limitations, is needed for the return, then e-file error check will need to be turned off prior to e-filing.
Follow these steps to turn off e-file error checking:
- Go to the Clients tab.
- Highlight the applicable client.
- From the E-File menu, select e-file Support Tools.
- Select Disable e-file Error.
- Click OK to confirm that e-file diagnostic error checking has been turned off for this client.
- Continue with e-filing the return.