N-66 Sch. Q: Quarterly Notice to Residual Interest Holder of REMIC Taxable Income or Net Loss Allocation (Form N-66) (Revision 2017)
Hawaii · Hawaii DoTax · Used for tax years 2024, 2025, 2026
Hawaii Schedule Q (Form N-66) is a quarterly notice to a REMIC residual interest holder reporting their share of taxable income or net loss. It also reports ownership percentages, capital account changes, excess inclusion, and certain expenses.
Who files this form
A real estate mortgage investment conduit (REMIC) must complete Schedule Q for each person who held a residual interest at any time during the calendar quarter.
The REMIC files Copy A with Form N-66 and gives Copy B to the residual interest holder. The holder keeps Copy B for their records and does not file it with their own tax return.
When it's due
The REMIC must give Copy B to the residual interest holder by the last day of the month following the month in which the calendar quarter ends.
The text does not print year-specific due dates or a separate deadline for filing Copy A with Form N-66.
What you'll need
Have the following information ready:
- The calendar quarter covered by the schedule.
- The REMIC’s and residual interest holder’s names, mailing addresses, and identifying numbers.
- The holder’s entity type and ownership percentages, including changes during the quarter.
- The REMIC’s asset percentages, quarterly taxable income or net loss, daily accrual amounts, and applicable section 212 expenses.
- Capital account information, including contributions, income, deductions, withdrawals, and distributions.
Attach a statement listing the date and ownership percentage before each change if ownership changed more than once during the quarter. Also attach a statement explaining any differences between the capital account amounts and the REMIC’s books, records, and balance sheet amounts.
How to file
- Copy A: File with Form N-66.
- Copy B: Give to the residual interest holder. The holder should keep it, not file it with their tax return.
- Copy C: Keep with a copy of Form N-66 in the REMIC’s records.
The supplied text does not provide a mailing address or e-file instructions.
Common mistakes
- Using the schedule without checking the holder instructions. Read the instructions on the back of Copy B before transferring information to a tax return.
- Changing an incorrect schedule yourself. Ask the REMIC for a corrected Schedule Q. Do not change items on your copy, and make sure the REMIC sends the corrected copy to the Department of Taxation.
- Using an individual’s SSN for an IRA holder. Enter the IRA trust’s identifying number instead.
- Entering a negative excess inclusion. For line 2c, subtract line 2b from line 1b, but do not enter less than zero.
- Leaving cents in business tax entries. Business income tax filers must round all dollar entries on returns and schedules to the nearest whole dollar.
Questions people ask
What does Schedule Q report?
It reports the holder’s share of the REMIC’s quarterly taxable income or net loss, excess inclusion, and section 212 expenses.
Do I owe tax if the REMIC did not distribute the income to me?
Yes. Residual interest holders are liable for tax on their share of the REMIC’s taxable income whether or not it was distributed, and must include that share on their tax returns.
Can I claim the full net loss shown on my schedule?
Generally, you cannot claim a quarterly net loss greater than your adjusted basis in the residual interest at the end of the quarter, calculated without that quarter’s net loss. A loss disallowed for exceeding basis is treated as incurred in the following quarter only to offset your share of REMIC taxable income for that quarter.
Who needs lines 3a and 3b completed?
These lines are completed only for individuals and other pass-through interest holders. They are not required for other entities.