Virginia and Paolo own an S corporation 50/50. During the year the entity distributes a parcel of land equally to the shareholders. The entity acquired the land four years ago for $600,000. At distribution the land has FMV of $1,000,000. The entity had ordinary business income for the year of $80,000. Virginia's beginning of the year stock basis is $30,000 and Paolo's is $75,000. What is the tax consequence to Paolo on the distribution if before considering any activity for the year the entity had the following balances: AAA: $40,000 AEP: $10,000 0AA: $0