Eliminations client can't be in a California combined group

You may get a diagnostic that states an eliminations client with CA attached cannot be included in a CA combined group.
Per Title 18 Cal. Code Reg. Section 25106.5-1, income or losses from intercompany transactions are deferred rather than eliminated. To calculate the combined group return in accordance with Reg. Section 25106.5-1, the eliminations client cannot be used for California. Instead, enter adjustments related to intercompany transactions on the CACAdj screen or in Apportionment information:
  1. Go to
    View
    and select
    Apportionment
    .
  2. On the
    California
    tab, enter
    Intercompany amounts
    .
For more information, refer to FTB Publication 1061, Guidelines for Corporations Filing a Combined Report.
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