Refundable deposits are included as income on the income statement. This caused a tax issue

I flagged my new tenant’s refundable deposit this year as a “Deposit.” I used the Stessa income statement to file my tax return, however I see this deposit is included in the top line gross income line. My understanding of USA rental income law is this deposit is not income until the point at which I must use to to satisfy late rent or damage. I don’t see any other way to manage the deposit transaction to “hide” it from my income statement I use for tax purposes. Should I not be using the income statement for this purpose? Do you think refundable deposits are taxable? Other thought? Thanks.

@trey.kauerz This is a bit strange because Stessa does not have a “Deposit” category under Income. Stessa has a “Security Deposits” category under Transfers, which of course does not impact the income statement or net cash flow report. Transfers are always shown “below the line.”

Perhaps you have us confused with another online financial platform?