Jeff, a contractor, builds an office building for a construction partnership in exchange for a capital and profits interest in the partnership worth $500,000. Which of the following statements is correct?

A. Jeff recognizes $500,000 of ordinary income and the basis of Jeffs interest in the partnership is $0.

B. Jeff recognizes no income and the basis of Jeffs interest in the partnership is $500,000.

C. Jeff recognizes $500,000 ordinary income and the basis of Jeff's interest in the partnership is $500,000

D. Jeff recognizes no income and the basis of Jeffs interest in the partnership is $0.