Purchased the stock three years ago as investment

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Helen, Greg, and Wanda own the stock in HGW Corporation with earnings and profits of $900,000 as follows: Helen, 600 shares; Greg, 400 shares; and Wanda, 1,000 shares. Greg is Helen’s son, and Wanda is Helen’s sister. HGW Corporation redeems 400 of Helen’s shares with a basis of $55,000 for $240,000. Helen purchased the stock three years ago as an investment. With respect to the stock redemption, Helen has: A. Dividend income of $185,000. B. Dividend income of $240,000. C. Long-term capital gain of $185,000. D. Long-term capital gain of $240,000.

Reference no: EM131286564

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