Wow! that's great it helped. You just have been trying since late September? I had been stuck with this issue for months but couldn't find a solution. Always seen Microsoft reps replying to the posts which never helped. I just used to try searching for it after every couple of weeks with no gain at all. Today it just clicked me. So here is my full take on this issue. Not sure about anyone else but I verified this multiple times before posting here.
Short Solution: This is only if you have enabled 2FA. Just log out on the remote computer, then sign back in with your Microsoft account password instead of your PIN. That's it. Now try accessing the machine remotely.
**Long Story:**First of all, it's not directly related to 2FA. But it's involved very easily to produce this issue. The actual problem, I think, is with how Windows stores your Microsoft Password and makes it available for remote access.
- Take one thing in mind that when you enable 2FA on your Microsoft Account, you get an option during the sign-in flow, to use Authenticator App for login without providing your password.
- So when you link your Windows Account with your 2FA-enabled Microsoft Account, the first-time default option is likely to use Authenticator App to log in, unless you click the option below to "Use Password Instead" or something like that in the sign-in dialog.
- When you do not provide Microsoft Account password during this process, Windows probably is not storing your password because it's only authenticated via the Authenticator App and you set your PIN right away for your ease.
Considering the above, I tried the following three scenarios and had the results as I expected.
- Microsoft Account (without 2FA) only needs a password to sign in. linked to Windows ---- Remotely Accessible.
- Microsoft Account (2FA enabled) authenticated with Authenticator App, linked to Windows --- Remotely
NOT Accessible.
- Sign-in on Remote computer with the Microsoft Account (only once) instead of the PIN --- Remote Access Starts Working.
- Microsoft Account (2FA enabled) authenticated using MS Account Password, linked to Windows -- Remotely Accessible.
So when all the above I tried was on a new test framework, I only had to Sign-in on my actual remote machine with my actual Microsoft Account password (for once) instead of the PIN. Now I have the Remote machine running on my second screen right, when I am writing this.
With all that, I believe Microsoft has to fix this as I think it's only the issue that Windows has no idea about your Microsoft Password. So when you try to remote access this certain machine, it fails because this does not directly interact with Microsoft servers to validate your credentials. Once you actually provide your password on the remote machine (for once only), Windows stores the password (though in encrypted form) and knows it, it all starts working...
Else Microsoft knows well, what's going on there.