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If you need more time to file a REMIC

There are exceptions to the economic

state return. This would include changes

return, get Form 7004, Application for

performance rule for certain items,

made as a result of an examination of the

Automatic 6-Month Extension of Time To

including recurring expenses. See section

REMIC return by the IRS. Contact the

File Certain Business Income Tax,

461(h) and the related regulations for the

state tax agency where the state return is

Information, and Other Returns, to

rules for determining when economic

filed for more information.

request an automatic 6-month extension.

performance takes place.

Assembling the Return

You must file Form 7004 by the regular

Rounding Off to Whole Dollars

due date of the REMIC return.

If you need more space to report items

The REMIC may round off cents to whole

shown on the forms or schedules, attach

Period Covered

dollars on its returns and schedules. If the

separate sheets reporting the items. Use

File the 2005 return for:

REMIC does round to whole dollars, it

the same size and format as on the

must round all amounts. To round, drop

printed forms. But show the totals on the

1. Calendar year 2005;

amounts under 50 cents and increase

printed forms. Be sure to put the REMIC’s

2. Short tax years beginning and

amounts from 50 to 99 cents to the next

name and employer identification number

ending in 2005; or

dollar (for example, $1.39 becomes $1

3. Short tax years beginning and

(EIN) on each sheet.

and $2.50 becomes $3).

ending in 2006, if the 2006 Form 1066 is

You must complete every applicable

not available by the time the REMIC is

If two or more amounts must be added

entry space on Form 1066. If you attach

required to file its return. However, the

to figure the amount on a line, include

statements, do not write “See Attached”

REMIC must show its 2006 tax year on

cents when adding the amounts and

instead of completing the entry spaces on

the 2005 Form 1066 and incorporate any

round off only the total.

this form.

tax law changes that are effective for tax

Recordkeeping

years beginning after December 31,

Other Forms and Returns That

2005.

The REMIC records must be kept as long

May Be Required

as their contents may be material in the

Form 1096, Annual Summary and

In the case of 2 or 3 above, fill in

administration of any Internal Revenue

Transmittal of U.S. Information Returns.

the tax year space at the top of

law. Copies of the filed tax returns should

Use this form to summarize and send

the form.

also be kept as part of the REMIC’s

CAUTION

information returns to the Internal

records. See Pub. 583, Starting a

Where To File

Revenue Service Center.

Business and Keeping Records, for more

information.

If the REMIC’s principal business, office,

Form 1098, Mortgage Interest

or agency is located in the United States,

Statement. This form is used to report the

Final Return

then file the return at: Internal Revenue

receipt from any individual of $600 or

If the REMIC ceases to exist during the

Service Center, Ogden, UT 84201-0007.

more of mortgage interest and points in

year, check the box on Form 1066, page

the course of the REMIC’s trade or

If the REMIC’s principal business,

1, item D(1).

business.

office, or agency is located in a foreign

The box on Schedule Q (Form 1066),

country or U.S. possession, then file the

Forms 1099-A, B, C, INT, LTC, MISC,

item E(1) should also be checked to

return at: Internal Revenue Service

OID, R, S, and SA. Use these

indicate when the schedule is for the final

Center, Philadelphia, PA 19255.

information returns to report acquisitions

quarter of the year.

or abandonments of secured property;

Accounting Method

proceeds from broker and barter

Amended Return

A REMIC must compute its taxable

exchange transactions; cancellation of a

income (or net loss) using the accrual

If the REMIC files its return and later

debt; interest income; certain payments

method of accounting. See section

becomes aware of changes it must make

made under a long-term care insurance

860C(b).

to income, deductions, etc., the REMIC

contract and certain accelerated death

should then file an amended:

Under the accrual method, an amount

benefits; miscellaneous income

•

Form 1066 and check the box on page

is includible in income when:

payments; original issue discount;

1, item D(4); and

distributions from pensions, annuities,

•

1. All the events have occurred that fix

Schedule Q (Form 1066), for each

retirement or profit-sharing plans,

the right to receive the income, which is

residual interest holder, and check the

individual retirement arrangement (IRAs),

the earliest of the date:

box at item E(2). Give corrected

insurance contracts, etc.; proceeds from

a. the required performance takes

Schedules Q (Form 1066) to each

real estate transactions; and distributions

place,

residual interest holder.

from an HSA, Archer MSA, or Medicare

b. payment is due, or

Advantage MSA. Also, use these returns

If a REMIC does not meet the

c. payment is received and

to report amounts that were received as a

small REMIC exception under

2. The amount can be determined

nominee on behalf of another person.

sections 860F(e) and 6231, and

CAUTION

with reasonable accuracy.

related regulations, or makes the election

Generally, a REMIC must file Forms

described in section 6231(a)(1)(B)(ii) not

See Regulations section 1.451-1(a) for

1099-INT and 1099-OID, as appropriate,

to be treated as a small REMIC, the

details.

to report accrued income of $10 or more

amended return will be a request for

Generally, an accrual basis taxpayer

of regular interest holders. See

administrative adjustment, and Form

can deduct accrued expenses in the tax

Regulations section 1.6049-7. Also, every

8082, Notice of Inconsistent Treatment or

year when:

REMIC must file Forms 1099-MISC if it

•

Administrative Adjustment Request

All events that determine the liability

makes payments of rents, commissions,

(AAR), must be filed by the Tax Matters

have occurred,

or other fixed or determinable income

•

Person. See sections 860F(e) and 6227

The amount of the liability can be

(see section 6041) totaling $600 or more

for more information.

figured with reasonable accuracy, and

to any one person in the course of its

•

Economic performance takes place

If the REMIC’s federal return is

trade or business during the calendar

with respect to the expense.

changed for any reason, it may affect its

year.

-2-

Instructions For Form 1066 - U.s. Real Estate Mortgage Investment Conduit (Remic) Income Tax Return - 2005 Page 2

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