I am also having an issue with the state of Massachusetts with regard to this problem and I mailed my state tax return. I am retired from the federal government. I contacted the Office of Personnel Management and was told that OPM (Federal Government) does not issue 1099-Cs and the states are supposed to recognize that fact. MA State DOR tells me they don't accept the Feds 1095-C. Oh the conundrum. I've now been charged the penalty for my wife and I so I'll have to deal with the state on that.
My recommendation to Turbo Tax is to pursue/ask/prompt/add the question when filing the MA state tax returns if the filer had health insurance through the Federal Government. If yes, then a comment about the filer having health care coverage thru the Federal Government should be stated.
I'd like to know if Turbo Tax will pursue this or some other solution for their customers. Having to mail a return because of this is not the right answer.
Respectfully,
Dave
