Between March 30 and April 17, some Michiganders opened their mail to find “notice of adjustment” letters from the Michigan Department of Treasury telling them their refunds had been cut or that they suddenly owed money. The problem: their bank deposits and payment records did not match what the state was saying. State officials and the Michigan Association of CPAs now say a system error is to blame and that corrected notices are on the way.
CPA Network Flagged The Problem
According to MICPA, members began reporting letters that claimed 2025 estimated payments had not been applied to returns, even though taxpayers and their accountants had documentation showing the payments were made. The association says it is working with the Department of Treasury and that the state has paused sending additional notices while it investigates and pursues a remedy.
Treasury Acknowledges A Display Error
In a response letter shared with MICPA, the Michigan Department of Treasury acknowledged that an unintended issue was introduced during an adjustment to a new system and apologized for the confusion. The department wrote that taxpayer prepayments are properly accounted for and reflected correctly in Michigan Treasury eServices, and said taxpayers do not need to take action at this time. Corrected notices will be issued for letters dated between March 30 and April 17. MICPA includes additional guidance and contact information.
Why The Letters Looked Serious
A “Notice of Adjustment” is not the kind of mail most people ignore. It typically signals that a refund has been applied to an outstanding state debt or that the department has changed a return. So when numbers in the mailed letters did not line up with taxpayers’ own records, nerves spiked quickly.
The Treasury’s guidance explains what those notices usually mean and what documents or steps are needed to resolve an account discrepancy. For the official explanation of notice types and how to respond, see the Michigan Department of Treasury.
What To Do If You Got A Notice
If one of these letters landed in your mailbox, start by checking your bank records and logging in to Michigan Treasury eServices to confirm that your prepayments and refunds are posted correctly.
If you received an unexpected refund check, the department says do not cash it. Instead, return the uncashed check with a written explanation to the Michigan Department of Treasury, P.O. Box 30788, Lansing, MI 48909, and keep a copy for your records.
If you still have questions, contact the Individual Income Tax Contact Center at 517-636-4486 or submit an inquiry through eServices.
The episode is a reminder of how a software tweak can turn tax season into a headache in a hurry. MICPA credited its members with quickly spotting the issue, while the Treasury says it expects to issue corrected notices and resolve affected accounts before taxpayers’ appeal windows close. In the meantime, the department is urging filers and CPAs to hang on to their documentation while it finishes its fixes.
