Domain Namespace Requirements. To set up federated delegation for your on-premises Exchange 2010 organization, you must configure a domain proof of ownership record for any domains used for user e-mail accounts or for hosting user accounts in Microsoft Outlook Live or Microsoft Online Services.ou can use DNS Manager or the DNSCmd command to create a TXT record for federation. For detailed instructions, see Create a TXT Record for Federation. Step 3: Configure the domains for federated delegation. You also need to add the primary SMTP domain as a federated domain for your Exchange organization.