The IRS regulations require the taxpayer to identify replacement property, as follows:

Within 45 days following the date of closing on the relinquishment of the current property, the exchanger must identify the replacement property, in writing (the identification must occur no later than the 45th day, whether or not that day is a Saturday, Sunday or holiday). The exchanger may identify:

Any 3 (or fewer) properties; or

Any 4 (or more) properties, provided that the aggregate values of the properties identified may not exceed 200% of the value of the property relinquished in the exchange; or

The "95% Rule"

Any number of properties. provided that the properties actually acquired have a total value at least equal to 95% of the total value of all properties identified . 

Special Rule for Property Acquired Within the 45 Days

Property actually acquired within the 45 day identification period is "deemed" identified.  Therefore, if all of the replacement property is acquired within the 45 day period, it is not necessary to provide a written identification of property during the 45 day period.

However, if the taxpayer acquires replacement property within the 45 day period and intends to acquire additional replacement property between the end of the 45 day period and the 180 day deadline, the taxpayer must provide the written identification in compliance with one of the rules described above.  Most importantly, all properties acquired within the 45 day period must be counted in determining compliance with these rules.  For example, if the taxpayer acquires one property during the 45 day period, the taxpayer may identify only two more properties under the 3 Property Rule.