The guest checkout in the default theme does not recognize the state in the address form. The states are listed in the dropdown, and populate the field when selected but on submitting the form an error is returned “This country requires you to choose a State.” This does not happen when an account is created and an address is added. I tested it using addresses from both the US and Canada.
@mdekker Thank you!
Yes, Country=USA. I have all other countries activated except most in Africa, Iran, Iraq and North Korea.