Longhorn Company reports current E&P of $100,000 in 20X3 and accumulated E&P at the beginning of the year of negative $200,000. Longhorn distributed $300,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in Longhorn is $100,000. How is the distribution treated by the shareholder in 20X3? $300,000 dividend $100,000 dividend, $100,000 tax-free return of basis, and $100,000 capital gain $100,000 dividend and $200,000 tax-free return of basis $0 dividend, $100,000 tax-free return of basis, and S200,000 capital gain