Got an IRS or Michigan Treasury Letter? What to Do

A Michigan filer can get a tax letter from three places: the IRS, the Michigan Department of Treasury, and, in 24 cities, the city income tax office. Most of these letters are routine, and many are settled with one reply. Nearly all of them carry a deadline, and the deadline is the part that actually costs you. Here is how to read the letter, confirm it is real, and decide whether to answer it yourself.

Step 1: Work out who sent it

This matters more in Michigan than in most states, because the answer changes where you look it up, who you answer, and which return is in question.

• The IRS. Your federal return. The letterhead says United States Department of the Treasury, Internal Revenue Service, which is easy to confuse with the state agency below. Look for the IRS name and a notice number.
• Michigan Department of Treasury. Your MI-1040, a business tax, or a credit you claimed. State notices can be viewed and answered through Michigan Treasury eServices, so an account there is worth setting up before you need it.
• A city income tax office. Twenty-four Michigan cities levy an income tax on residents and on nonresidents who work there. Detroit's return is processed by the state, so a Detroit letter arrives from Treasury. Flint moves to state administration on January 1, 2027, for the 2026 tax year. The other 22 cities run their own forms, filing, and support, so the letter comes from the city itself.

Step 2: Confirm it is genuine

Impersonation is common enough to check first. The IRS, Michigan Treasury, and the cities all make first contact by mail, not by phone call, text, email, or social media. None of them demand immediate payment by gift card, wire transfer, or cryptocurrency. None of them threaten to send police. None of them ask for a bank login or a card number over the phone.

A genuine notice names a specific tax year, refers to a specific return, carries an identifier, and explains how to disagree. If you have any doubt, do not dial the number printed on the page. A fake letter prints a fake number. Sign in to your account at IRS.gov, where real federal notices are visible, or to Michigan Treasury eServices for state notices. For a city letter, take the phone number from the city's own website, not from the letter.

Step 3: Find the notice number and the deadline

Every IRS notice has an identifier, often a code beginning with CP or LTR, printed in a corner. Searching that code on IRS.gov brings up a plain description of what the letter means and what response is expected. Treasury and city letters identify the tax year and the return they concern; use that as your reference on everything you send back.

Then find the date you must respond by, and write it down. Response windows run from the date printed on the letter, not from the day you opened it, and mail can take a week to reach you.

Step 4: Work out which kind of letter you have

The right response depends on the category, and the categories vary enormously in seriousness:

• Informational. A change was made, a refund adjusted, a payment applied. Often no reply is needed. Read it, check it against your records, keep it.
• A request for something specific. A missing form, a signature, proof of identity, or documents supporting a credit. Usually resolved by sending what is asked for, on time.
• A proposed change to your return. Typically because a figure did not match what an employer, bank, or broker reported. This is a proposal. You can agree or disagree, but only within the window.
• A balance due. Interest and penalties accrue while it is outstanding, so time matters here.
• An examination notice. Comparatively rare. This is the point to get a credentialed professional involved before responding.
• Collection activity. Notices about levies or liens are the most serious and the most time-sensitive. Do not sit on these.

Three kinds of letter are distinctly Michigan, and two of them are new since 2025:

• A state adjustment where your federal and Michigan figures disagree. Public Act 24 of 2025 decoupled Michigan from the federal code starting with tax year 2025. For business owners the state return no longer follows the federal one on bonus depreciation, the business interest limit, research costs, or the section 179 limit, and the Michigan return needs an addition to bridge the gap. A letter noting a mismatch is not automatically an error. It may be the decoupling addition you made correctly, or the one you missed. Treasury's notice of February 25, 2026 sets out the adjustments for 2025.
• A denied flow-through entity credit. From the 2025 return onward, a member of an electing partnership or S corporation must report the credit on Forms 6072 and 6074 with the MI-1040, or the credit is denied. If a letter removes a credit you were expecting, check whether those forms went in.
• A city asking for a nonresident return. You live in one place and work in one of the 24 cities with an income tax. Detroit taxes residents at 2.4% and nonresidents who work there at 1.2%. People who commute in from elsewhere often do not realize they owe the city a return until it writes.

Step 5: Check the claim against your own records

Before conceding or disputing, pull the return in question and the supporting documents. A surprising share of proposed changes trace back to something ordinary: a form that arrived after you filed, a corrected 1099, income reported under the wrong year, a duplicate. Knowing which it is decides everything about your reply.

If you cannot find the federal return, request a transcript from IRS.gov. Your Michigan filing history is in Treasury eServices. If a paid preparer filed the return and will not give you a copy, treat that as its own warning sign. Our guide on choosing a CPA lists the red flags.

Step 6: Decide whether to handle it yourself

Plenty of notices are a one-letter job. Handle it yourself when the letter is informational, asks for a document you have, or reflects a small correction you agree with after checking.

Get a credentialed professional involved when:

• The letter is an examination or collection notice.
• You disagree with a proposed change of any real size.
• The amount is significant relative to what you could absorb.
• Several years are involved, or letters from more than one agency.
• Business income, rental property, or an entity return is in scope, and especially if the letter touches the 2025 decoupling adjustments.
• You suspect the underlying return was prepared badly or dishonestly.

Here the credential is not a nicety. Only a CPA, an enrolled agent, or an attorney can represent you before the IRS, authorized on Form 2848. An uncredentialed preparer cannot speak to the agency for you even if they prepared the return that caused the letter. Those representation rights are federal. For a Treasury notice, your CPA files the state's own authorization; for a city notice, your CPA deals with that city's income tax office directly. Our guide to the three credentials explains what that means in practice.

In Michigan, check which CPA license you are hiring. A license number starting 1101 is a licensed accountant, cleared for the unrestricted practice of public accounting. A number starting 1103 is a registered accountant, who may use the title but may not practice public accounting. Look the name up on LARA's license lookup (opens in new tab) before you sign anything. Every CPA listed in this directory holds an active 1101 license.

Step 7: Respond in writing, and keep everything

• Answer by the deadline, even if your answer is that you need more time or are disputing the figure.
• Reply to what was actually asked. Extra volunteered information widens the conversation without helping you.
• Send copies, never originals, and put the notice identifier and tax year on every page.
• Use a method that proves delivery. For a state notice, answering through Treasury eServices leaves a record with a timestamp. For paper, keep the mailing receipt.
• Keep a copy of the entire package, plus notes of any phone call: date, time, who you spoke to, what was said.

This guide is general information, not tax or legal advice. IRS, Michigan Treasury, and city procedures, forms, and deadlines change, and the right response depends on your specific notice and facts. Verify current requirements with the agency that wrote to you or with a licensed professional before acting.

Frequently asked questions