Russell Corp. is a C corporation that began operations in Year 1. Russell Corp.s Year 1 through Year 3 taxable earnings and profits are as follows:

Year	E&P
1	$	(	25,000	)
2			5,000
3			10,000

On the last day of Year 3, Russell Corp. makes a $12,500 cash distribution, distributed equally among its two shareholders, Rex and Patty. Assuming Rex has sufficient basis in the Russell Corp. stock investment, what amount, if any, of Rexs distribution is a taxable dividend?

	a.	$5,000
	b.	$0
	c.	$6,250
	d.	$1,250