Quincy worked at a company that had purchased a $100,000 key person policy on his life. When Quincy left the company, the employer offered to sell him the policy. Quincy purchased the policy from the employer for $25,000. Quincy continued to make the premium payments which were a total of $15,000. When Quincy died, his son Jonah received the policy proceeds from the insurance company. What are the income tax consequences for Jonah?

a. Jonah will receive the policy proceeds income tax-free.

b. Jonah must recognize ordinary income of $60,000.

c. Jonah must recognize capital gains of $60,000.

d. Jonah must recognize capital gains of $15,000 and ordinary income of $25,000.