Seems to be a California problem.  

https://accountants.intuit.com/community/lacerte-diagnostics/37468/ta-p/211146/show-comments/true 

Lacerte needs to fix this.  Straddles happen all the time and in 2023 the same trust had a straddle and it wasn't an issue, paper filing is not a solve.  I will try to override or move entry to not have to paper file but Lacerte should address.

What part of "The above diagnostic is specific to California electronic filing of Fiduciary returns. It will trigger for any CA resident Fiduciary return, or for any CA non-resident Fiduciary return that has a Contract and Straddle entry  . . .If the amounts are supposed to be sourced to CA, then you can e-file the Federal return, but you will have to paper file the California return" do you not understand?

If you want to complain, contact the Franchise Tax Board, don't expect Lacerte to break state rules.

I am not expecting Lacerte to break any rules but it didn't make any sense that I had the exact same thing last year with no issues and no diagnostic.  

FTB didn't have the exact same rule last year.  Or, they let Lacerte slip by without following it.