Anwar is a cash basis landlord whose property was condemned becasuse it had numerous housing code violations.The tenant had treatened to sue Anwar because the tenant had to move out.Anwar paid the tenant $3000 in settlement of all claims.Which of the following statement is correct?

A.The tenant must capitalize the $3000

B.the tenant does not have to include the $3000 in its gross income

C.the landlord can deduct the $3000

D.the landlord cannot deduct the $3000