Sometimes you want to guide people away from a particular word choice because it sounds racist or otherwise hateful. But if you say "Dude, you can't say that, that's racist!" they'll start arguing that they're not racist. Which distracts from the issue at hand of adjusting word choice.
I've found a more effective way to convey this can be "That could come across as racist," especially if you add "[other word choice] would come across better."
The benefit of "come across as" is it doesn't even get into what the thing is. It's simply the impression that it gives. If your interlocutor is someone who feels that they are good and well-intentioned and people just keep misinterpreting them, this aligns with their self-concept.