Designation of Partnership Representative (PR)

Unless the REMIC has made a valid election out of the centralized partnership audit regime or had only one residual interest holder at all times during the tax year, the REMIC must designate a PR. The PR can be any person with a substantial presence in the United States. The PR will have the sole authority to act on behalf of the REMIC. If an entity is designated as PR, the REMIC must also appoint an individual to act on the entity’s behalf (a designated individual (DI)). The DI must also have a substantial presence in the United States.

How to designate. An original designation of a PR must be made on the REMIC’s Form 1066 filed for each respective REMIC tax year.

PR authority. The REMIC and all its residual interest holders (and any other person whose tax liability is determined in whole or in part by taking into account directly or indirectly adjustments determined under the centralized partnership audit regime) are bound by the actions of the PR in dealings with the IRS. A designation for a partnership tax year remains in effect until the designation is terminated by:

• Valid resignation of the PR,

• Valid revocation of the PR, or

• Determination by the IRS that the designation isn’t in effect.

Substantial presence. In order for either a PR or a DI to have substantial presence in the United States, they must:

• Make themselves available to meet in person with the IRS in the United States at a reasonable time and place, as determined by the IRS;

The amounts shown should agree with the REMIC’s books and records and the balance sheet amounts. Attach a statement explaining any differences.

Include in column (d):

• Tax-exempt interest income,

• Other tax-exempt income,

• Income from prohibited transactions,

• Income recorded on the REMIC’s books but not included on this return, and

• Allowable deductions not charged against book income this year.

• Have a street address that is in the United States;

• Have a telephone number with a U.S. area code; and

• Have a U.S. taxpayer identification number.