Jill owns 600 shares of Cubco , Inc , Debbie owns 200 shares of Cubco Inc , and Heather owns 200 shares of Cubco , Inc. Jill is Heathers mother . Debbie is unrelated to Jill and Heather. On June 30, 2019 , Cubco redeems 250 shares of stock from Jill . Jill receives $350,000 from Cubco and the stock redeemed has a basis of $300,000 . CubcoI has earnings and profits of $1,000,000 . As a result of this redemption what gain or income must Jill recognize ?

A.

Jill recognizes $350,000 of dividend income.

B.

Jill recognizes $50,000 capital gain

C.

Jill recognizes $300,000 capital gain.

D.

Jill recognizes $50,000 dividend income