Brad owns 2,000 shares of Cane Corporation common stock with an adjusted basis of $20,000. He has owned these shares for 3 years. In 2018, Brad receives a nontaxable stock dividend of 20 shares of Cane preferred stock. Fair market values at the time of the dividend were: $8,000 for the preferred stock; and $72,000 for the common. Six months after the stock dividend, Brad sells all of his preferred shares for $7,000. What is the amount and character of Brads recognized gain on the sale of the preferred stock?

	A.	$6,800 LTCG.
	B.	$5,000 STCG.
	C.	$6,800 STCG.
	D.	None of the above.
	E.	$5,000 LTCG.