Is a customer deposit income when I receive it?

Not necessarily. Depending on how your books and entity are set up, a deposit may be unearned until the work is done. Ask your tax professional how deposits should be treated for your specific entity and tax reporting.

Why does my deposit show up twice in QuickBooks?

Usually because the customer payment was recorded and then the matching bank feed deposit was added again instead of matched. Matching the bank feed transaction to the existing payment fixes the duplicate.

QuickBooks for LandscapersMay 10, 20267 min readReviewed June 15, 2026By Skylar Giron Sabillon

How to Record Customer Deposits in QuickBooks

A practical guide for service businesses that take customer deposits before work is complete and need cleaner invoices, payments, and bank matching.

This resource is educational. Ask your accountant about entity specific or tax specific treatment for deposits and retainers.

Short answer

Customer deposits should connect to the customer, invoice, payment workflow, and bank deposit. Duplicate deposits often happen when bank feed deposits are added instead of matched.

Checklist

Identify whether the money is a deposit, payment, or retainer.
Connect customer payments to invoices when appropriate.
Review undeposited funds before adding bank deposits.
Match bank feed deposits instead of duplicating them.
Reconcile the bank account after deposits are recorded.

Common mistakes

Adding a bank feed deposit after already recording the customer payment.
Leaving payments sitting in undeposited funds.
Posting deposits to generic income with no customer detail.
Not tying deposits back to the job or invoice.

Examples for service businesses

50% deposit collected before a landscape installation.
Deposit taken before ordering trees or plants for a job.
Start payment collected before a mulch or cleanup job.
Final invoice issued after the work is complete, with the deposit applied.
Cash or check deposit that must be matched to the right customer.
ACH or card payment that hits the bank net of processing fees.

Why deposits get messy in landscaping

Landscaping owners often collect money before the job is done so they can order plants, trees, mulch, rock, or materials. The problem is that QuickBooks can show the money incorrectly if the payment, invoice, customer, bank feed, and deposit workflow are not connected.

The deposit shows up twice, or it lands in generic income with no customer attached, and suddenly the books say you earned revenue you have not actually finished working for.

Undeposited funds confusion

QuickBooks uses undeposited funds as a holding area before payments are grouped into an actual bank deposit. If that workflow is not reviewed, deposits can appear duplicated or missing.

How a landscaping deposit should flow

The cleanest path keeps the customer, the invoice, and the bank deposit connected from start to finish.

Record the deposit against the customer and job, not generic income.
When you collect 50% before a landscape install, tie it to that customer's job.
Order trees, plants, or mulch against the job so the deposit and materials line up.
Invoice the balance when the work is complete and apply the deposit.
Match cash, check, or ACH/card payments to the customer; card and ACH often land net of processing fees.