Section 409(A) violations can be complicated, so this should not be construed to be expert advice. I believe that even though the payment in question vested, and should have been made in 2020, since you did not have constructive receipt of the funds, it should be reported on your 2023 return, and not your 2020 return. The payment is subject to interest from the date the payment should have been made. The interest rate is the "underpayment" rate plus 1% on the underpayments that would have occurred had the amounts so required to be included in gross income. To calculate the amount of interest, you will first need to determine the amount of the underpayment of tax in 2020 by recalculating your tax liability for that year as if the payment had been made.
Depending on the amount of money involved, you might want to seek out a professional to help you. Consult your state's society of CPAs. Should you choose to do it yourself, you might consider contacting the IRS for guidance on how to calculate and report the interest.
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