The state of Michigan had another tax-season hiccup when it sent a batch of letters that scared some taxpayers into thinking they wouldn’t be getting their state income tax refunds.
A “Notice of Adjustment” indicated that the taxpayer who received the letter was on track to receive a smaller refund — or even owe more money in taxes. Except, whoops, the letters were sent in error.
The “glitch” is fairly widespread, according to George Smith, a CPA with Andrews Hooper Pavlik in Bloomfield Hills, Michigan.
In some cases, the taxpayers paid what they owed for 2025 through estimated tax payments or other payments by the April 15 deadline to the Michigan Department of Treasury. The letter indicated that the tax filer didn’t pay what was owed.
“I had a woman in today whose payment to Treasury two weeks ago has not been applied to her account and they issued a notice accordingly,” Smith said Wednesday, April 22.
The Michigan Department of Treasury, Smith said, is aware of the mistake, and hopefully will fix it soon.
Ron Leix, a Michigan Treasury spokesperson, told the Detroit Free Press that the state sent out about 27,000 letters in error due to a system change.
The letters, he said, “related to estimated payments and credit carry-forwards” and were dated between April 7 and April 28, 2026.
“Importantly, this error was related only to the letters themselves,” Leix said in an email sent in the early afternoon Thursday, April 23.
“Taxpayer prepayments are properly accounted for and reflected correctly in Michigan Treasury eServices,” he said.
Leix said taxpayers do not need to take any action at this time, as corrected letters will be issued very soon.
What one firm’s email blast told tax clients
Plenty of frustrated tax filers reached out to their tax professionals and others seeking some answers once they received the unexpected notices.
Andrews Hooper Pavlik sent an email blast to its clients Wednesday, April 22, regarding the erroneous notices from the Michigan Department of Treasury that reflected a change in payments.
“The state of Michigan has acknowledged a systemic issue,” according to the accounting firm’s letter, “which is resulting in many taxpayers receiving a Notice of Adjustment reflecting reduced overpayments/refunds or increased balances due caused by their system not reflecting estimated payments made.”
The accounting firm’s email blast went on to reassure clients that they could ignore these letters for now.
“We have been told they have paused any future notices from being sent out; however, many were sent before the issue was discovered,” according to the Andrews Hooper Pavlik email.
“They are working to resolve the issue on their end with no action necessary by taxpayers or CPAs and no change to your overpayment/refund/balance due.”
Other CPAs in Michigan spot trouble
Robert Wexler, a certified public accountant in Sterling Heights, said about four clients of PLW CPA PLLC received such letters in less than a week. What he has found particularly troubling is that tax filers had a hard time getting someone on the phone at the state to explain what’s going on.
“Errors do happen,” Wexler said.
“Now people are calling and they can’t even get through. And we can’t call on someone’s behalf unless we have power of attorney,” Wexler said.
In addition, he said, it’s not really worth it for a taxpayer to pay a CPA to make phone calls when the accountant really cannot change the outcome or get the state to move more quickly when a letter is sent in error.
Most likely, he said, the state will issue more guidance or send letters to taxpayers in the future, stating that the notice was sent in error.
“In the meantime, people freak out because they don’t know,” Wexler said.
The stress is even worse, of course, when someone suddenly thinks they owe more money in taxes than expected.
Wexler said the state may be addressing these issues already, as one client who received a notice of adjustment sent him an email Thursday, April 23, indicating that her state income tax refund was deposited in full. It did not reflect any reduction to cover unpaid taxes, as the earlier notice of adjustment indicated.
In February, I reported another issue where some early filers reported long delays in receiving their state income tax refunds.
The state Treasury acknowledged some refund delays then, attributing some early processing delays to the transition from the legacy system to a new modernized IT platform that began late last year.
The MICPA posted a notice online on Tuesday, April 21, indicated that the Michigan Association of Certified Public Accountants is working with the Michigan Treasury to resolve an issue involving some taxpayers who received notices from the state “stating that 2025 estimated payments were not applied to their annual returns, though both taxpayers and their CPAs report the payments were made.”
The MICPA stated on Tuesday, April 21, that the state had not yet provided a resolution. But the Treasury Department did indicate that it paused sending additional notices as it works to fix the problem.
It’s clear that the professional organization heard from plenty of tax professionals in Michigan about the notices, as the MICPA stated that it “appreciates the strong member engagement that helped identify the issue.”
(This story has been updated to include new information.)
Contact personal finance columnist Susan Tompor: stompor@freepress.com. Follow her on X @tompor.
This article originally appeared on Detroit Free Press: Michigan Treasury sends out wrong notices, scaring some tax filers
Reporting by Susan Tompor, Detroit Free Press / Detroit Free Press
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