Why is efile not recognizing this exception if they're filing only to get a refund from withholding.

[xmasbaby0]

No one can see your screen or the return you are trying to e-file.  We do not know who "they" are.    A general answer would be that if someone has already filed a tax return and it was accepted by the IRS, then any other return using the same SSN's on it is going to be rejected and will have to be filed by mail instead.  The IRS will not accept two e-filed tax returns with the same SSN's on them.