I just received a tax due notice from the IRS for this exact situation. I’m retired and received a W2 from former employer. Box 1 shows 1) voluntary deferred compensation under 509 plan that was paid in the current year (also reported in box 11) and 2) proceeds from stock options vested in the current year (also reported in box 12a code V) and 3) proceeds from a bonus I was eligible for that was subject to two year delay and amount is based how the company stock performed. The latter 2 items I was never taxed previously for SS and Medicare so they are included in my box 3 & 5 earnings.
My interpretation of the various literature is that I could make a IRA contribution based on the earnings (box 1 less box 11) that were not previously available to me until the year in which they were paid and reported in the W2 which is after my retirement date. I’ll post the outcome.
