During 2022, Paul, an individual taxpayer, sells residential rental property for $180,000, which he acquired in 2001 for $160,000. Paul has claimed straight-line depreciation on the building of $50,000. What is the amount and nature of Paul’s gain on the sale of the rental property?

a. $70,000 ordinary income

b. $10,000 ordinary income and $60,000 ordinary gain

c. $70,000 Section 1231 gain

d. $20,000 Section 1231 gain, $50,000 “unrecaptured depreciation”

e. None of the above