Actually, it is NY state that won't let you e-file the NY return because state withholding is more than 25% of your NY wages.
Individual states control their e-filing systems and set certain parameters to identify returns that might not be legitimate or accurate. Returns that report an excessive* percentage of state tax withheld fall outside NY parameters for e-filing. By making you file by mail, it gives them the opportunity to have a human being confirm your withholding was correct.
* NYS highest tax rate is 8.82%,
