@jschwartz20 @tacas 

"thank you for your suggestion; however, for many, this won’t work. We have several items that make up our invoices. Once we sub-total, we then have a separate line item for the retention, showing the final balance the contractor will pay."

Just to confirm, this thread only applies to cash basis reporting.  What exactly won't work?  If your retention item is mapped to an income account, and entered as a negative amount on the invoice, your P&L will show $0 income until payment is received on the invoice, at which point, only the net received from your customer will show as income on cash basis.  There will be two entries on your income ledger(s) depending on what income account you are mapping the invoice and retention item to: one for the total invoice amount and another for the retention as a negative amount, thereby reducing income by the retention.  That is the crux of this thread.  It works like a charm.  Then, when you bill for retention, add the retention item to an invoice and it will remove the negative income entry. 

The issue the OP had was that the entire invoice amount is showing as income when the invoice payment (less retention) was received.  That's because the retention was mapped to an asset account.  It can't be mapped to an asset account if you're on cash basis.  If you map retention to a balance sheet account, the entire invoice amount will post as income when the payment is received because the basis of double-entry accounting is assets + liabilities + equity.  If you post retention to an asset account, then retention + payment = income.  That why it needs to be mapped to an income account.  That way, payment = income - retention.