In Year 1, Silver Corporation distributed nonconvertible nonvoting preferred stock worth $20,000 each to its two equal common shareholders, Wesley and Yolanda. Prior to the distribution, Yolanda's basis in her common stock was $13,000. Each shareholder's common stock had a value of $40,000 immediately after the distribution. At the time of the distribution, Silver had $65,000 of accumulated earnings and profits. In Year 4, Silver had $80,000 of accumulated earnings and profits. Yolanda sells her preferred stock to Wesley in Year 4 for $18,000. How much gain must she recognize on this sale and what is the character of her gain?