Taxpayer, a cash method taxpayer, owned all the stock in a company that owned all the rights in a new type of X-ray scanning device which had an extremely speculative value. She had owned the stock for three years and had a $100,000 cost basis in it. She sold the stock to a big electronics firm for $50,000 cash and 2 percent of the earnings generated by the scanning device over the succeeding life of the electronics firm and she made a  453(d) election. Although her right to earnings is speculative, she receives $2,000 in each of the succeeding years

requirement :

What are the tax consequences to Taxpayer in each year