Sorry to inform you, but Illinois is not going to do anything until they receive a corrected W-2.
The W-2 is all the information they have to go on. That is why they sent you a letter reversing what you stated.
Writing a letter and/or explaining that it is an error will be in vain until they have a corrected W-2.
This is the employers responsibility. Since you indicated that the company is no longer around, I believe you will be out the $$ involved.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
