The defendants, a married couple, entered into a contract (purchase agreement) to sell a tract of real estate to a third party. After entering into the contract, the defendants refused to close. The buyer sued for specific performance and a court ordered the sale to close. The funds from the sale were distributed in various ways, but were not reinvested in replacement property. However, the defendants did not report the gain from the sale, claiming instead that the gain was deferrable under I.R.C. Sec. 1033 as an involuntary conversion. The IRS audited and claimed that the income from the sale was not deferrable under I.R.C. Sec. 1033 and imposed an accuracy-related penalty. The court granted the government's motion for summary judgment on the basis that the tract was not "compulsorily or involuntarily converted" because the defendants voluntarily tried to sell the property and, in any event, didn't reinvest the proceeds in replacement property within two years. United States v. Peters, No. 4:12CV01395 AGF, 2014 U.S. Dist. LEXIS 79316 (E.D. Mo. Jun. 11, 2014).