If you get a tax refund in 2018, that means in 2017 you paid too much in taxes. If you took a full deduction, then you deducted more than your tax amount —more than was allowed. Rather than make you amend your 2017 return to reduce your deduction, you report the refund as income in the year the refund is paid. It is a “taxable recovery” or a reimbursement of a previous deduction.
