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Join nowRE: In QuickBooks, we can only generate a .txt file for state W-2. If it's producing an error when uploading to the agency site, I'd suggest contacting the agency first. It could be that your state website requires a different format, so it'd be best to ask for assistance from them.
Only produce a txt file? QB produces EFW2 files using the state W-2 feature. The files are tailored to each state per their requirements.
If the file is wrong, that is either a QB bug or user error. Calling the state will not help the Intuit payroll customer create a better file for that state.