The definition of "closed"...

What is the definition of "closed" to meet the 180-Day deadline?

You have to close the purchase of your new property within 180 days of the sale of your old property. So what does "close" mean? Is it enough to have a purchase and sale contract on the property? Or perhaps an option? Can you close in escrow? The best way to answer this question is to ask another question: if the property burned down on the 181st day, who would be out their investment; you, the buyer, or the seller? If your answer is the seller, you have not closed, because in the eyes of the IRS risk of loss has to pass to you, the buyer, in order to meet the requirements of Section 1031.