Randall owns an office building (adjusted basis of $250,000) that he has been renting to a group of physicians. During negotiations over a new seven-year lease, the physicians offer to purchase the building for $900,000. Randall accepts the offer with the stipulation that the sale be structured as a delayed 1031 transaction. Consequently, the sales proceeds are paid to a qualified third-party inter-mediary on the closing date of September 30, 2020. On October 2, 2020, Randall properly identifies an office building that he would

like to acquire. Unfortunately, on November 10, 2020, the property Randall selected is withdrawn from the market. Working with the intermediary, on November 12, 2020, Randall identifies another office building that meets his requirements. The purchase of this property closes on December 15, 2020, and the title is transferred to Randall. Randall treats the transaction as a like-kind exchange. Even though the original

office building identified was not acquired, Randall concludes that in substance, he has satisfied the 45-day rule. He identified the acquired office building as soon as the negotiations ceased on his first choice. Should the IRS accept Randall's attempt to comply? Explain.

• (1) brief recap of the facts, (2) discussion of what the issue is, (3) the conclusion as to what the proper tax treatment is, and (4) the law and analysis supporting the conclusion.
• NOTE: the correct analysis will include a discussion of the law with citations to the Internal Revenue Code and appropriate Treasury Regulations.