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ABC Financial Services, Inc. received $250,000 from a client in 2016 and was required to repay $120,000 of that amount in 2021 as a result

ABC Financial Services, Inc. received $250,000 from a client in 2016 and was required to repay $120,000 of that amount in 2021 as a result of additional facts coming to light. Assuming that the $120,000 repayment would give rise to a deductible business expense, and that ABC's 2020 taxable income without considering the $120,000 repayment was $350,000. Fully discuss the options available to ABC regarding its treatment of the $120,000 repayment and how you would recommend that it treat the repayment

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