The gross estate of Raul, decedent, includes stock in Iris Corporation (E&P of $8 million) valued at $6 million. At the time of his death, Raul owned 60% of the Iris stock outstanding, and he had a basis of $840,000 in the stock. The death taxes and funeral and administration expenses related to Rauls estate amount to $2 million, and the adjusted gross estate is $16 million. The remainder of the Iris stock is owned by Monica, Rauls daughter and sole heir of his estate.

What are the tax consequences to Rauls estate if Iris Corporation redeems $2 million of its stock?