Your statement "Please note, this will require you to pay self-employment taxes, which are Social Security and Medicare taxes, on this income" seems to contradict IRS Publication 544 (https://www.irs.gov/pub/irs-pdf/p544.pdf), which states "Payments received by a tenant for the cancellation of a lease are treated as an amount realized from the sale of property." A sale of property would be a capital gain (or loss) and therefore, not ordinary income, right?
