Looking for a Form 1066 Templates? Download it for free!

For more details, see the 2005

charged on penalties imposed for failure

this market discount currently. If the issue

General Instructions for Forms 1099,

to file, negligence, fraud, substantial

price of a residual interest is more than its

1098, 5498, and W-2G.

valuation misstatements, substantial

adjusted basis, the excess is amortized

understatements of tax, and reportable

and included in the residual interest

Form 8275, Disclosure Statement, and

transaction understatements; the interest

holder’s income ratably over the

Form 8275-R, Regulation Disclosure

is charged from the due date (including

anticipated weighted average life of the

Statement. Use these forms to disclose

extensions) to the date of payment. The

REMIC (as defined in Regulations section

items or positions taken on a tax return

interest charge is figured at a rate

1.860E-1(a)(3)(iv)).

that are not otherwise adequately

determined under section 6621.

disclosed on the return or that are

If the adjusted basis of a regular

contrary to Treasury regulations (to avoid

Late filing penalty. A penalty may be

interest is more than its issue price, the

parts of the accuracy-related penalty or

charged if the return is filed after the due

regular interest holder treats the excess

certain preparer penalties).

date (including extensions) or the return

as amortizable bond premium subject to

does not show all the information

Form 8300, Report of Cash Payments

the rules of section 171. If the adjusted

required, unless each failure is due to

Over $10,000 Received in a Trade or

basis of a residual interest is more than

reasonable cause. If the failure is due to

Business. Generally, this form is used to

its issue price, the excess is deductible

reasonable cause, attach an explanation

report the receipt of more than $10,000 in

ratably over the anticipated weighted

to the return. If no taxes are due, the

cash or foreign currency in one

average life of the REMIC (as defined in

penalty is $50 for each month or part of a

transaction or a series of related

Regulations section 1.860E-1(a)(3)(iv)).

month (up to 5 months) the return is late

transactions.

Payments Subject to

or does not include the required

Form 8811, Information Return for Real

information, multiplied by the total number

Withholding at Source

Estate Mortgage Investment Conduits

of persons who were residual interest

(REMICs) and Issuers of Collateralized

If there are any nonresident alien

holders in the REMIC during any part of

Debt Obligations. A REMIC uses this form

individuals, foreign partnerships, or

the REMIC’s tax year for which the return

to provide the information required by

foreign corporations as regular interest

is due. If tax is due, the penalty is the

Regulations section 1.6049-7(b)(1)(ii).

holders or residual interest holders, and

amount stated above plus 5% of the

This information will be published in Pub.

the REMIC has items of gross income

unpaid tax for each month or part of a

938, Real Estate Mortgage Investment

from sources within the United States

month the return is late, up to a maximum

Conduits (REMICs) Reporting Information

(see sections 861 through 865), see Form

of 25% of the unpaid tax, or if the return is

(And Other Collateralized Debt

1042, Annual Withholding Tax Return for

more than 60 days late, a $100 minimum

Obligations (CDOs)). This publication

U.S. Source Income of Foreign Persons.

or the balance of tax due on the return,

contains a directory of REMICs.

whichever is smaller.

Who Must Sign

Pub. 938 is not printed. Instead, it is

Late payment penalty. The penalty for

available on CD-ROM or the Internet. See

Startup day after November 9, 1988.

not paying the tax when due is usually

How To Get Forms and Publications on

For a REMIC with a startup day after

of 1% of the unpaid tax for each month or

page 1 of the instructions for details.

November 9, 1988, Form 1066 may be

part of a month the tax is unpaid. The

signed by any person who could sign the

Form 8822, Change of Address. This

penalty cannot exceed 25% of the unpaid

return of the entity in the absence of the

form is used to inform the IRS of a new

tax. The penalty will not be charged if you

REMIC election. Thus, the return of a

REMIC address if the change is made

can show reasonable cause for not

REMIC that is a corporation or trust would

after filing Form 1066.

paying on time.

be signed by a corporate officer or a

Payment of Tax Due

trustee, respectively. For REMICs with

Other penalties. Penalties can also be

only segregated pools of assets, the

The REMIC must pay the tax due (page

imposed for negligence, substantial

return would be signed by any person

1, Section II, line 3) in full by the 15th day

understatements of tax, reportable

who could sign the return of the entity

of the 4th month following the end of the

transaction understatements, and fraud.

owning the assets of the REMIC under

tax year. Enclose with Form 1066 a check

See sections 6662, 6662A, and 6663.

applicable state law.

or money order for the amount due

Contributions to the REMIC

payable to the “United States Treasury.”

Startup day before November 10, 1988.

Generally, no gain or loss is recognized

The REMIC may be required to

A REMIC with a startup day before

by the REMIC or any of the regular or

deposit its tax using the Electronic

November 10, 1988, may elect to apply

residual interest holders when property is

Federal Tax Payment System (EFTPS). If

the rules for REMICs with a startup day

transferred to the REMIC in exchange for

this requirement applies, use EFTPS to

after November 9, 1988 (as described in

an interest in the REMIC. The adjusted

deposit the tax.

Regulations section 1.860F-4(c)(2)(iii)).

basis of the interest received equals the

Otherwise, Form 1066 must be signed by

If the REMIC is not required to deposit

adjusted basis of the property transferred

a residual interest holder or, as provided

its tax using EFTPS, it may do so

to the REMIC.

in section 6903, by a fiduciary as defined

voluntarily. To do this, the REMIC must

in section 7701(a)(6) who is acting for the

The basis to the REMIC of property

be enrolled in EFTPS.

REMIC and who has furnished adequate

transferred by a regular or residual

For information about EFTPS, visit

notice as described in Regulations

interest holder is its fair market value

or see Publication 966,

section 301.6903-1(b).

immediately after its transfer.

The Secure Way to Pay Your Federal

Taxes for Business and Individual

In the prior paragraph, the term

If the issue price of a regular interest is

Taxpayers-EFTPS.

“startup day” means any day selected by

more than its adjusted basis, the excess

a REMIC that is on or before the first day

is included in income by the regular

Interest and Penalties

on which interests in such REMIC are

interest holder for the applicable tax years

issued. Otherwise, “startup day” is

Interest. Interest is charged on taxes not

as if the excess were market discount on

defined in the instructions for Item B —

paid by the due date, even if an extension

a bond and the holder had made an

Date REMIC started on page 4.

of time to file is granted. Interest is also

election under section 1278(b) to include

-3-

Instructions For Form 1066 - U.s. Real Estate Mortgage Investment Conduit (Remic) Income Tax Return - 2005 Page 3

Related Articles

Related forms

Related Categories