Unless you are not explaining this correctly I don't see how the employee would be in trouble. You said your employer deducted the correct amount of witholding from your paychecks according to your pay stubs but sent the IRS less and reported that lesser amount on your W2. If this was a witholding mistake and you were paid too much then, yes, you would owe the difference come April 15 and all would be good. But the employer knowingly cheated you and the IRS, first by pocketing some of your witholding then filing fraudulent witholding returns. It is he who faces federal charges, jail time, fines and restitution. So your SS account would be credited.
There are lots of employers sitting in federal prison for doing exactly this.
-Hal
3 companies.
1 was closed by the IRS for not paying the withholding taxes taken from the pay checks.
License was revoked. The debt was $80k 25 years ago.
No jail time. He went on to open another shop.
Income reported to the IRS was NOT what I was paid. He kept the difference.
Another company closed and never claimed I earned anything that year.
That owner went on to open a strip club.
3rd still open today.
He also lied and under reported that I earned less. Keeping my taxes removed from my check in his pocket.
All 3 cases the IRS could careless about my case.
Fill out a form and proved proof from pay stubs.
Same with Social Security. They don't just credit you. You have to prove your case, provide docs, and fill out the forms.
Sorry if I come off as ticked off.
But when you get ripped off and seen no results you may feel different.
The IRS wont do nothing for the worker. SS will only correct your account with proof. Not saying the DOL won't, but never got anywhere with that.
The IRS isn't going to someones doorstep with shotguns when they cheated on the taxes.