My former employers closed their business 12/31/2007. During 2007 my fellow employees and I received pay checks with stubs indicating proper taxes were deducted. It is now March 2008 and we (the employees) have still not received our W-2's. I have tried to contact my former employers by every means possible to no avail. I notified the Labor commission and was told my former employers never paid any employee taxes for 2007. I contacted the IRS and was sent form 4852. I now have to estimate my wages and taxes from my pay stubs, and submit them to the IRS.
If my former employers never submitted the taxes, and we, the employees are submitting estimated wages and taxes, will we the employees be penalized if the IRS never acquires the missing money from my former employer?
What penalties will my former employers face for pocketing my Social Security/Medicare, state and federal taxes?
Is this seen as a crime against me and my fellow employees for burglary since my former employers, took our money with knowing intent, and by issuing pay stubs with the pretence of submitting our taxes to the proper agencies?
Is it possible for we the employees to file suit against our former employers?
FYI: Business located in California, and employers are husband & Wife.
More than one question.. Hopes that's OK!
Thank you

YOU will not be held responsible for the withheld taxes not paid to the IRS or the state of California. If you submit the Form 4852 with a copy of the paystub, the IRS will honor it like a W-2 and then go after the owners of the business.

Of course, California will also pursue the business owners.