On April 30, 2016, Kelley Incorporated issued 1,000 shares of its publicly traded stock as compensation to its employee, Thomas. On date of issuance, the stock's fair market value was $10,000. Under the terms of his employment contract, Thomas could not dispose of the stock or terminate his employment with Kelley before January 1, 2021. Otherwise, he had to forfeit the stock back to Kelley. Thomas did not make an election to recognize income in 2016. On January 1, 2021, Thomas, who was still a Kelley employee, sold all 1,000 shares for the current fair market value of $50,000. What are the 2021 tax consequences to Thomas? Thomas recognizes $50,000 ordinary income and $0 capital gain on sale of the stock. Thomas recognizes $0 ordinary income and $50,000 capital gain on sale of the stock. Thomas recognizes $10,000 ordinary income and $40,000 capital gain on sale of the stock. Thomas recognizes $0 ordinary income and $10,000 capital gain in sale of the stock