Taxes: what do I do about getting a w2 from a startup that has gone belly up in the US?

Question

Last year (2012) I worked for a startup through May before moving on. Between May and now (March 2013) I have moved twice. Neither time did I think to update the old employer so that they could send me my W2. Also, since then, the company has gone belly up.

The company was very small, and never had a proper HR department. They also did not use a payroll company. I only have one phone number for a former manager at the company (we never had a 'corporate' phone number) and I'm not receiving any response when contacting him (calling or texting).

So my question: What do I do now? I don't have a W2, I need one to fill out my taxes, if they sent one it was sent to the wrong address, and even if I get a hold of my one contact from the company there is a good chance he won't be able to do anything for me.

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As a note: I have looked for my old pay-stubs, but like I said I've moved twice since then and am unable to find them. I have since learned to keep much better track of financial documents! However.... that lesson has come a little too late for this situation.

Answer 1

Generally you should keep your paystubs until you receive your W2, and keep your W2 indefinitely. That is how you can keep track of what you earned, what taxes you paid, and settle disagreements with the IRS/States and the Social Security Administration, if and when those arise.

But that is not helpful to you as you have not done that, and its too late.

The next step would be contacting the employer and/or the payroll service who was in charge of issuing the paychecks. Even if the employer is defunct, the payroll service will still have all the information and will be able to issue a copy of the W2 for you. This is again a general advice, as it seems that it doesn't apply to your particular situation.

So what else do you have to do? The IRS has some instructions:

1. Contact the employer.
2. Contact the IRS, if no other way to get the information is available. The IRS might be able to tell you what they see on their side, i.e.: what was reported to them. That doesn't mean that you can rely on that information as facts, but it will give you an estimate of the real numbers. The problem might be with States - it may be that some of the deductions you had that were pre-tax for Federal taxes, are not pre-Tax for State, and using just the IRS numbers may then land you in trouble with the State.
3. Submit the tax return on time using the best possible data. You can use Form 4852 instead of W2 if there's no way for you to recover that. Be ready to be audited, your return will likely raise red flags with the IRS and the State.
4. If and when you do get the W2 (continue working on recovering it), submit an amended return with the precise information.

I would personally suggest having a tax professional dealing with this, a return without W2 is likely to trigger an audit, or at least some calls and notices from the IRS/State that the professional will know better how to deal with.