Should unused vacation earned while employed and converted to payment after retirement be included as income for the year earned or year when the last check was received?

[lhyatt]

Retired at end of calendar year 2017.  Received reimbursement for unused vacation mid-2018 after "time and attendance" adjustments were made.  Received W-2 reflecting payment.

[rjs · Accepted solution]

All payments from your employer are reported as income in the year that you receive the payment. If you received payment in 2018, it is reported on your 2018 W-2 and your 2018 tax return, even if the payment was earned in an earlier year.