Luis is the sole shareholder of a C corporation, and Eduardo owns a sole proprietorship. Both businesses were started in 2011, and each business has a long-term capital gain of $20,000 for the year. Neither business made any distributions during the year. With respect to this information, which of the following statements is incorrect?
a. Eduardo must report a $20,000 long-term capital gain on his 2011 tax return.
b. Louis's corporation does not receive a preferential tax rate on the $20,000 long-term capital gain.
c. Luis must report a $20,000 long-term capital gain on his 2011 tax return.
d. Eduardo receives a preferential tax rate on a long-term capital gain of $20,000.
e. None ofthe above.