Iris collected $$150,000$ on her deceased husband's life insurance policy. The

policy was purchased by the husband's employer under a group policy. Iris's

husband had included $$5,000$ in gross income from the group term life

insurance premiums during the years he worked for the employer. She elected

to collect the policy in $10$ equal annual payments of $$18,000$ each.

None of the payments must be included in Iris's gross income.

The amount she receives in the first year is a nontaxable return of capital.

For each $$18,000$ payment that Iris receives, she can exclude $$500$

$($$$5,\frac{000}{\text{\$}}180,000$$$18,000)$ from gross income.

For each $$18,000$ payment that Iris receives, she can exclude $$15,000$

$($$$150,\frac{000}{\text{\$}}180,000$$$18,000)$ from gross income.

None of these.