On July 21, 2019, Sam Jones, a cash basis taxpayer, received a check in the amount of $250,000 as a fee for services rendered. The invoice that prompted the check payment contained a double billing of a $95,000 item. On November 19, 2019, Jones entered into a written agreement with his client obligating him to repay the $95,000. Jones repaid $65,000 of this amount on February 2, 2021. In preparing his 2019 tax return, Jones excluded the $95,000 from his 2019 gross income.

On March 3, 2022, the Service commenced and audit of his 2019 tax return and ultimately made a timely audit adjustment including the $95,000 in his 2019 taxable income. A week after receiving notice of the audit, Jones repaid the remaining $30,000 to his client.

Assuming Jones wishes to contest the audit adjustment, advise him as to the arguments available to him and assess his chances of success. Fully explain your answer.