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As a 31 year now retired IRS agent I'd like to inform you that when an employer withholds federal taxes from the paychecks of employees the employer is responsible for depositing those funds with the IRS. All Forms W-2 provided to the employees for filing their personal tax returns are accepted by the IRS without question and the federal withholding is credited to the employees even if the employer did not deposit the withheld funds with the IRS. We agents attempted to collect the withheld taxes from the employers. The employees are not liable at all.

Collecting withheld taxes from employers was a top priority when I worked for the IRS. We also performed a full compliance check to make sure that the employers reported the Social Security and Medicare wages and taxes withheld from each employee to ensure that employees would receive SS and MED benefits when they reached retirement age. That was one of the little known services the IRS used to provide when it was sufficiently staffed. Those MAGAs in Trump's congress who have made draconian cuts to the IRS budget are screwing 'ordinary' Americans by weakening IRS oversight of the compliance of employers. Obviously, their claim to be the party of working people is a farce.

In the worst case scenario when a delinquent employer fails to deposit withheld taxes with the IRS:
---In most cases when small business employers run by sole proprietors abscond with the funds they spend the $$$ for personal expenses and possibly luxuries.
---By the time an IRS agent makes contact the business may have folded, the business owner is no where to be found, and there are no assets available for the IRS to appropriate to collect the withheld taxes. In most cases most if not all of the withheld taxes are never collected.
---Assuming that the delinquent employer provides Forms W-2 to the employees (or the employees have to file an estimate) they are given full credit for the income tax withheld from their wages. In many cases they receive refunds on their Form 1040 tax returns based on withheld taxes that were never paid to the government. The amounts refunded are $$$ that drain the Treasury of funds needed for the federal budget. As far as I recall there were no reports that specifically tracked those 'lost' funds but per the GAO the estimated Tax Gap (taxes not paid) regarding employment taxes is approximately $94 Billion per year.