Should it be "if it weren't for holes, a bagel would be a bun" or "if it wasn't for holes, a bagel would be a bun"?
I've been reading about the subjunctive and how it is generally used with "if" where "if" expresses a wish or refers to something that doesn't exist - but I'm not sure in this case. 'Holes' exist... but the sentence is talking about what it would be like if they didn't exist.
The difference between the two is one of style, were(n't) being more formal than was(n't). The authors of 'The Cambridge Grammar of the English Language' (Huddleston and Pullum) go so far as to say that this verb form isn't subjunctive at all, preferring to describe it as irrealis. As they say:
This use of were is highly exceptional: there is no other verb in the language where the modal remoteness meaning is expressed by a different inflectional form from the past meaning. The irrealis mood form is unique to be, and limited to the 1st and 3rd person singular. It is an untidy relic of an earlier system, and some speakers usually, if not always, use preterite was instead.
So, to answer your question, there's nothing wrong with If it wasn't for holes, a bagel would be a bun and for many native speakers it will be the natural construction to use.
EDIT:
As further explanation in the light of the comments below, here’s Huddleston and Pullum’s footnote on the subject:
Traditional grammar calls our irrealis a ‘past subjunctive’, contrasting with ‘present subjunctive’ be. But there are no grounds for analysing this were as a past tense counterpart of the be that we find in constructions like It’s vital that he be kind to her. We don’t use ‘subjunctive’ as a term for this inflectional category, but for a syntactic category employing the plain form of the verb.
For balance, I’d better also quote the following from ‘Oxford Modern English Grammar’ by Bas Aarts, published in 2011:
This form [were] of the verb BE, in the first or third person, can be seen as a relic of the past subjunctive.
And later:
. . . modern English does not have a subjunctive mood to speak of. It therefore makes little sense to speak of the ‘present subjunctive’ forms of English verbs, simply because they cannot be distinguished from the plain forms . . . English also does not have past subjunctive verb forms . . . The only exception is the verb BE which has the past subjunctive form were for the first and third person singular . . . This is the only true remnant of a subjunctive form in English.
In the course of his discussion, Aarts acknowledges the preference in American English for constructions such as I urged in my previous letter that these research staff be treated as their present colleagues. He contrasts this with Some water boards insist that all cold water taps in the house are taken from the rising main, suggesting that ‘this construction is barely used in American English’.
It has nothing to do with informal and formal. It is simply right or wrong. The key distinction boils down to the difference between verb moods in complex sentences, that is, sentences that have a main clause and at least one subordinate clause. The use of were and weren't in the subordinate clauses depends on the reality or truthfulness of the subordinate clause. If it is true, then the indicative forms was and wasn't are in order. If it is not true, i.e. counterfactual, then the past subjunctive forms were and weren't are used.
Let's look at some examples. One of the easiest to deal with is subordinate clauses where the verb in the main clause is some form of wish. The semantics of these sentences imply that the subordinate clauses are not true, so the past subjunctive forms are called for:
I wish I were able to take that job. (But I am not able to take the job.) Do you wish she weren't on call tonight? (But she is on call tonight.)
The other common pattern is with if-then sentences. (Note: then may be implied if it is not always verbalized, and the then clause may precede the if clause in that case.) If the main and subordinate clauses are both true or not known to be true or false, then the indicative verb forms are used:
If I wasn't asked to help, at least I was willing to help. (And I wasn't asked to help.) If they are prepared, then they will come out on top. (And they may or may not be prepared--we'll see.)
The most common pattern that people get tripped up on are if-then sentences where the if clause is counterfactual. In these cases, the if clauses use the past subjunctive forms were and weren't, even if the subject is singular or the verb is present tense. The then clause--and this is usually a giveaway--will take the conditional form. This is usually indicated by the word would or one of the other past form modal verbs (could, might):
If I were a rich man, I wouldn't have to work hard. (But I am not a rich man.) He could be much more successful if he weren't so negative. (But he is so negative.)
Let's turn, finally, to the sentence that your spelling checker flagged:
The letter claimed exactly the same as the first, namely that if his letter wasn't published, he would be angry.
Now, by the rules I have laid out you would expect that wasn't, the indicative form, would be appropriate because we didn't know if his letter was published. Actually, it is not what we know that matters but what the writer of the second letter knew, but it nets out to the same grammatical issue. If this were a counterfactual conditional, i.e., it was known that the letter wasn't published, then weren't, the past subjunctive form, would be correct. But it isn't a counterfactual, so wasn't is OK here.
So why would your spelling checker get it wrong? Because it looks so much like a counterfactual conditional. Remember my hint that the presence of would in the main clause is a giveaway that you have a counterfactual conditional. Well, it is except when it isn't, and this is one of those relatively rare cases where it isn't.
There is another grammatical pattern at play here--indirect quotes. Suppose that yesterday Bob said, and I quote, "I am late for class." I, today, quoting Bob indirectly, would say, "Bob said that he was late for class." Note two changes from Bob's statement to mine. First, Bob's first-person pronoun I becomes my third-person pronoun he. Second, present tense verb forms in Bob's statement become past tense verb forms in my statement, and the person changes from first to third, i.e., am becomes was. Note that all of the clauses in Bob's statement and mine use the indicative mood, present tense or past tense--no subjunctive or conditional mood clauses.
Now, let's do the same thing, but change what Bob said. Suppose that yesterday Bob said, "If my letter isn't published, I will be angry." And now, today, quoting Bob indirectly, I would say, "Bob said that if his letter wasn't published, he would be angry." Everything is indicative here. In particular, would is a past tense indicative form, not a conditional form, so in the associated if clause, the past tense indicative third-person singular form wasn't is used, not the past tense subjunctive form weren't. In this case, you are right, and the spelling checker is wrong. Now, hopefully, you know why.
I agree that IF IT WERE OR IF I WERE are more formal English but I also feel it is a use of the imperfect subjunctive that underscores the possibility and not the "factuality"of the statement in question. I often get spell correct questions about statements such as I DEMAND or I INSIST THAT HE ARRIVE ON TIME... my ear tells me that "he be on time" is in the realm of the what is not yet real...it may or may not happen. I feel that this is the realm of the subjunctive. Irrealis means that which is not real... something that speaker does not place in the realm of the real or factual. Of course this is very much akin to Grevisse explanation of the subjunctive in his book on French, LE BON USAGE. So much for my opinion.
