You simplify a smart object, frame layer, type layer, shape layer, solid color layer, gradient layer, or pattern fill layer (or a layer group imported from Photoshop) by converting it into an image layer. You need to simplify these layers before you can apply filters to them or edit them with the painting tools. However, you can no longer use the type‑ and shape-editing options on simplified layers.
If you selected a shape layer, click Simplify in the options bar.
If you selected a type, shape, or fill layer, or a Photoshop layer group, choose Simplify Layer from either the Layer menu or the Layers palette More menu.