In December 2017,Max,a cash-basis taxpayer,rents an apartment to Kadeem.Max receives both the first and last months' rent totaling $1,800 plus a security deposit of $400.The amount of income reported by Max as taxable in 2017 is

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C)A security deposit is not taxable until final disposition.That is,it is not taxable unless nonrefundable or until the tenant moves out and all or part of the deposit is not returned to the tenant.Rent is taxable when received.

In December 2017,Max,a Cash-Basis Taxpayer,rents an Apartment to Kadeem