I had a very similar problem this week. Since my only income is Social Security and I don't have a W-2 form, I can efile my Fed return. Only by mail. After going in circles for a day I figured out that if I can't efile my Fed return I can't efile my state return. I changed the method of my return to file by mail and I was able to proceed to finish. It is all very confusing when you reach the file section. Otherwise I really like Turbo Tax. I hope that helps you.