The following critical diagnostic generating in the Individual module of Lacerte:
Due to a reciprocal agreement with (State #1), the (State #2) return is not required to report any income. The return is being filed solely for the purpose of claiming a refund of state taxes withheld from (State #2). (reference# 949)
Why is this diagnostic generating?
This diagnostic is an informational diagnostic made critical to inform you of why the state return is generating. Typically, states that have a reciprocal agreement aren't required to file the other state return, unless a refund is being claimed. This diagnostic won't prevent the returns from being e-filed.
Refer to the form instructions for the applicable state for more information on the state's reciprocal agreement.