I don't know what the legalities of this are, or what to do about this, but it's very much an issue.
If you chose to pay your TurboTax fees from your federal refund --- instead of paying with a credit or debit card before you e-filed--- then you chose and agreed to have your federal refund go from the IRS to the third party bank. That bank receives your federal refund, takes out the amount you owe to TurboTax and pays TT, takes out its own "refund processing fee" of $40 ($45 in CA) and sends the rest of your federal refund to your bank account. The third party bank is not involved in any way with your state tax due. Your state tax due can never be paid from a federal refund. You have to pay the state tax yourself by sending the state a check or money order, or by using the state' tax payment site and your own credit or debit card on that site.
How can I see my TurboTax fees?
What is Refund Processing Service?
Santa Barbara Tax Products Group, LLC (SBTPG) is the bank that handles the Refund Processing Service when you choose to have your TurboTax fees deducted from your refund. This option also has an additional charge from the bank that processes the transaction.
You can contact them SBTPG, toll-free, at 1-877-908-7228 or go to their secure website www.sbtpg.com
You must pay your state tax due using the state’s preferred method of receiving payment. For most states that will be by making a payment to the state’s own tax website, or by mailing a check or money order.
WHAT IF I CANNOT PAY MY TAX DUE?