According to IRS, form 3520 instructions, the form has to be filed separately from the return. However, as is evident from the note at the bottom of the Step-by-Step screen: Personal Income >> Foreign Financial Assets Already Reported, TT thinks the form is to be mailed with the return.
Due to this when you say you have form 3520 to file, TT does not let you e-file. I don't recollect this bug in TT 2021 when also I needed to file a 3520, so it may be new in recent years. It needs to be fixed.