Peach Tree Corp. has accumulated earnings and profits $($E&P$)$ of $$1,680,000$ and no current E&P for the current year. On December $31$st Peach Tree Corp. distributes to Grape, its sole shareholder a parcel of land with a basis of $$1,560,000$ and a fair market value of $$1,200,000.$ Grape's basis in the stock is $$600,000.$ Grape plans on growing fruit trees on this land.

What portion of the distribution to Grape will be treated as a dividend? Note: do not adjust earnings and profits for the tax effect of any gains or losses due to the distribution.

$$ $$360,000$

$$1,560,000$

$$600,000$

$$1,200,000$