It's a good question. The uppermost layer of the ocean is called the 'mixed layer'. As the name suggests, it's a well-mixed layer where the properties are set (over short timescales) by the atmospheric conditions above and, because of weaker stratification at higher latitudes, it tends to be shallow at low latitudes and deep at high latitudes, particularly in the winter. When we talk about a water mass being formed, this usually refers to water leaving the mixed layer, and thereby no longer having its properties directly forced by the atmosphere. This can either occur through a time-mean vertical velocity, or horizontal currents (if the mixed layer profile is sloped). Deep water formation specifically refers to the formation of a water mass that is deep (where "deep" usually means "below the thermocline").