Indigo, Inc., just before the distribution described below, has $20,000 of earnings and profits. Indigo distributes land with a basis of 100,000 and a fair market value of $500,000 to its sole shareholder, Ben (an individual). As a result of these events, Ben:

A. Must recognize a gain of $400,000

B. Must report dividend income of $20,000

C. Must report dividend income of $500,000

D. Must report dividend income of $420,000

E. None of the above