To resolve this, you must check Yes to e-file Form 1120, done on the 1120 pg 1, so that Form 8879C is loaded into the return. Run diagnostics and then click the e-file button.
In the Select E-files dialog box, make sure to un-check the Federal return so that the e-file is created only for the state return.
This information applies to all years of the UltimateTax Desktop software.