J died this year. His sole asset was 800 shares of D Corporation stock, which were worth $8,000,000 (basis $2,000 per share). The remaining 200 shares of the stock were owned by J's son. In J's will, he provided that al of the stock go to his son. Estate taxes were $1,028,000, and funeral and administrative expenses were $472,000. In order to pay the death taxes, the corporation redeemed 200 shares of stock from J's estate for $2,000,000. Assuming the corporation has substantial E&P, the estate will report

a. no gain or loss or other income from the redemption distribution.

b. $1,960,000 capital gain.

c. $1,500,000 capital gain and $500,000 dividend.

d. $500,000 dividend.

e. none of the above.