Carlo received a nonstatutory stock option from his employer on January 1, 2020. The option gives him the right to purchase 100 shares of his company's stock at $12 per share. The option is not traded on an established market, and its value could not be readily determined when it was granted. Although Carlo did not exercise his option during the tax year, the value of the stock increased after he received the option. On December 31, 2020, the stock was trading at $22 per share. How much compensation does Carlo include in his 2020 income as a result of being granted this option?

$0

$1,000

$1,200

$2,200