Small Business Owners I have a question…K-1 Filed as W-2 in IRS System ?? Please help me to understand this please

I filed my 2024 1040 back in April. I usually file Schedule C as a small business but with expansion and an additional partner I had to file the business taxes first which generated Schedule K-1 for each partner. On my 1040 I reported that income as W-2 as there was no option for K-1 and I'm no longer a single member so Schedule C did not seem appropriate. I now have a 570 hold on my refund but the IRS wage transcript does show the K-1 income. Did I do this correctly?