Nikhil paid $47,000 for a bond with a par value of $50,000. The bond matures in three years. If he does NOT choose to accrue the $3,000 market discount, how will he report this amount on his tax return?

a. For each year that he owns the bond, he will report a capital gain of $1,000 and increase his basis by this amount.

b. He will report $3,000 in taxable interest for the year upon maturity.

c. He will have a $3,000 capital gain upon maturity.

d. He will have a $3,000 capital loss upon maturity.