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steps to fix this issue
go to your Windows 10 settings, there are numerous ways to get there
On the settings page, there is a search bar at the top, type in Troubleshoot. it might be, troubleshoot settings, instead.
Unfortunately most everything is going to be nonsensical unless you're a system administrator. there is one small clickable section at the bottom called, Additional troubleshooters, click on that.
There you will find your actual list of the Windows 10 troubleshooters. these are extremely automated, straightforward, user-friendly, and very effective.
Scroll down until you find the Recording Audio troubleshooter. Click on it, then click on the run the troubleshooter. It will take a bit of time and it's not going to tell you much of anything. but it will say it found a problem or something to that effect. it will then ask if you want to fix the problem. in all likelihood it will say you need to reboot your computer for the fix to take effect. if it does this reboot your computer immediately, do not do anything else except reboot your computer.
once rebooted xbox party will now find your microphone