A notice from the IRS can make a routine week feel anything but routine. One letter asking for records, explanations, or payroll support can leave you wondering whether you should call your preparer, answer it yourself, or get legal help before you say the wrong thing. If you are looking for an IRS audit attorney Michigan 2026 taxpayers can rely on, you are usually dealing with more than nerves. You want to know what changed, what the government is checking more closely, and how to protect yourself before a tax problem grows.
An audit does not automatically mean the IRS thinks you committed fraud. Many audits begin because a return was selected through computerized screening or document matching, or because a deduction needs backup. Still, what you do next matters. A strong response can narrow the issue, organize the right proof, and keep you from handing over information that creates new questions.
A CPA can be extremely valuable in an audit, and enrolled agents can help too. With the right authorization, both can communicate with the IRS and represent you in many audit settings. A tax attorney brings a different layer of protection when the issue starts moving from bookkeeping into legal risk.
The biggest difference is privilege. Confidential legal advice you give to a licensed attorney generally receives the strongest protection under attorney-client privilege. The tax rules also recognize a narrower confidentiality rule for certain noncriminal tax advice from federally authorized practitioners, but that is not the same as classic attorney-client privilege and it does not cover routine tax return preparation. In plain English, if you are worried about how to explain a weak position, incomplete records, or a payroll issue, legal advice from an attorney is in a different category than ordinary prep work.
A tax attorney also helps with strategy beyond the first audit letter. That can include preparing a careful written response, deciding what not to volunteer, handling conferences with the examiner, and representing you in IRS Appeals if the audit does not resolve at the examination stage. Say your business claimed an Employee Retention Credit, your payroll files are incomplete, and the IRS wants support fast. A CPA may help rebuild the records, but an attorney can shape the response with future legal exposure in mind. Levy Tax Help handles civil tax matters only and does not represent clients in criminal tax proceedings.
Most people still picture an audit as an agent showing up unannounced. That does happen, but many audits begin much more quietly. The IRS commonly selects returns through computerized screening, document matching, random sampling, and issue-based review. That means your return may be flagged because a W-2 or 1099 did not line up, because a deduction looks unusual for your income level, or because the IRS is focusing on a newer category of claims.
That matters more in 2026 because the agency is sorting through returns that use newer deductions created under the One Big Beautiful Bill Act, often shortened to OBBBA. New deduction rules create new matching problems. A taxpayer may have good records, but the payroll provider, tax software, and third-party forms may not present the data in the same way. When that happens, the IRS may send a letter before anyone at the agency has a full picture of what really happened.
Take a Michigan restaurant manager who worked overtime, received tip income, and changed jobs midyear. Her records may support the return, but one employer may report tips one way while another reports them differently. That is exactly the kind of mismatch that can trigger automated review even when the numbers are honest.
The biggest audit risk in this area is not the deduction by itself. It is the gap between what you claimed and what the IRS can quickly verify. The newer tips and overtime deductions are a good example. The tips deduction can reach up to $25,000, while the overtime deduction can reach up to $12,500 for single filers and $25,000 for joint filers. Those numbers get attention, especially when the paper trail is thin or the return relies on worksheets the IRS cannot immediately match to payroll records.
The overtime deduction has a built-in trap. It applies only to the premium portion of qualified overtime compensation for eligible workers, not every extra dollar earned from longer hours. If a taxpayer or preparer estimated from paystubs instead of pulling payroll detail, the deduction can be overstated without anyone intending to do that. The tips deduction creates its own issues because workers may have shared tips, pooled tips, or self-employment records that do not break the amounts out neatly.
ERC claims still belong on the red-flag list as well. Even though the credit is older, the IRS continues to review many claims closely. If you amended prior payroll filings or received a letter asking for support, treat that as a records case, not a customer-service call. Tax laws change frequently, so verify current figures at IRS.gov or michigan.gov/treasury before filing.
A Michigan audit is not just a smaller version of a federal audit. The Michigan Department of Treasury is a separate agency with its own notices, timelines, portal, and appeal path. That matters because you can resolve one issue with the IRS and still face a Michigan problem based on the same records.
In many Michigan tax disputes, the process begins with a Bill for Taxes Due, also called an Intent to Assess. If you disagree, you may have the right to request an informal conference with Treasury’s Hearings Division. After that, the case can move to a Final Assessment. Depending on the tax type and posture of the case, the next stop may be the Michigan Tax Tribunal or the Court of Claims. Treasury also uses an online taxpayer portal for appeals and document uploads, which means deadlines and document control matter from the start.
Here is why that distinction matters in real life. A business owner may finish an IRS payroll audit and assume the hard part is over. Then Michigan Treasury questions withholding or sales-tax records tied to the same payroll periods. The federal response cannot simply be copied and pasted. The state side needs its own strategy, its own deadlines, and often its own exhibits.
Helpful resources: Michigan tax relief team | tax audits and appeals services | contact us online | IRS.gov | Michigan Department of Treasury
The best time to call is often before the government contacts you. If you claimed a newer tips or overtime deduction, filed corrected payroll forms, have a pending ERC issue, or know your records do not line up cleanly, an early review gives you room to fix problems while you still control the pace.
That review is practical, not dramatic. A tax attorney can compare the return to payroll summaries, W-2 information, Forms 1099, bank deposits, time records, and any worksheet used to calculate the deduction. If something does not fit, you can decide whether the issue is harmless, needs explanation, or should be corrected before a notice lands in your mailbox.
Picture a salon owner in Oakland County who claimed the tips deduction using daily logs and booking software exports. The total may be right, but the categories may not match the way the IRS expects to see them. Before a notice arrives, that is a manageable records project. After a notice arrives, it becomes a deadline problem.
Once a notice arrives, speed matters. Do not ignore it, and do not assume a quick phone call will clear everything up. The first letter often names a year, a line item, or a deduction category, but your response can shape the entire case from there.
A strong response is focused. If the IRS asks for support on one deduction, you do not want to send a box of unrelated records that invites broader scrutiny. If Michigan Treasury is challenging a sales-tax or withholding item, you need to answer the notice you received, not every tax issue your business has ever had. That is where representation helps. Your team can control communications, build a clean exhibit set, and keep the issue from expanding unnecessarily.
This is also the point where guessing becomes expensive. People often damage their own cases by improvising, sending incomplete files, or volunteering explanations that create new questions. Even when the government has a valid concern, a careful response can narrow the adjustment, preserve appeal options, and reduce avoidable damage.
Audit defense works best when legal judgment and IRS experience sit at the same table. Levy Tax Help’s team includes attorneys, CPAs, and former IRS revenue officers, which means your case can be reviewed from more than one angle at the same time.
That matters because audits rarely stay in one lane. One issue may be legal, another may be accounting, and another may turn on how the IRS typically reviews the records. A former IRS revenue officer may recognize what documents the examiner is likely to ask for next. A CPA can tie the records back to the filed return. A tax attorney can decide how to frame the response, protect sensitive legal communications, and prepare the case for Appeals if needed.
You are not looking for panic or promises. You are looking for a team that knows how the process works and can respond with discipline. That is the real advantage of working with professionals who have seen these cases from both sides of the table.
No. Some audits are narrow and mostly about documents. A lawyer becomes especially useful when the dollar amount is large, the records are incomplete, ERC or payroll issues are involved, or you are worried your explanation could create legal exposure beyond a simple adjustment.
Yes. Federal and state tax systems are separate. A federal audit can lead to Michigan questions if the same records affect state withholding, sales tax, or income-tax reporting, or if your federal figures changed.
Start with W-2s, 1099s, payroll summaries, time records, daily tip logs, bank deposits, and any worksheet used to calculate the deduction. If you are self-employed, keep records that clearly separate tips from your general business receipts.
Gather the amended payroll returns, payroll reports, gross-receipts support, eligibility analysis, and any adviser memos or worksheets tied to the claim. Then have a professional review the file before you answer so the response is organized and limited to the issue raised.
If you’re dealing with an IRS audit, a Michigan Treasury notice, or questions about OBBBA deductions and need IRS audit attorney Michigan 2026 guidance, the team at Levy Tax Help is ready to help. Our attorneys, CPAs, and former IRS revenue officers have handled cases exactly like yours — many of us worked on the IRS side of these negotiations. Call (877) 500-4930 or contact us online for a free consultation.
Levy & Associates is available for free initial consultations. We’re happy to answer any questions you have about the audit process or address any concerns about your specific situation.
There’s never a good time to be audited, and the time-consuming process will take away from your business or family if you try to face it alone. Let us handle and coordinate communication, so you can return to your daily life.