Sale of rental real estate inside a trust

[leerobea]

My client inherited rental property which is still inside the trust (by title). If he sells the rental property at a loss, can he distribute the loss to the beneficiaries. If he cannot, can he distribute the property to the beneficiaries who can then sell it and take an investment loss?

[Bees Knees]

How can someone sell property they do not own? If the trust owns the property, only the trust can sell it.

If the trust sells the property, gain or loss on the sale may be taxable to the trust, or passed through to the income beneficiaries, depending on what type of trust this is (grantor trust, complex trust, simple trust, etc.).

[Burke]

My client inherited rental property which is still inside the trust (by title). If he sells the rental property at a loss, can he distribute the loss to the beneficiaries. If he cannot, can he distribute the property to the beneficiaries who can then sell it and take an investment loss?

Don't do anything until you obtain a copy of the trust document and read it. It should spell out who established the trust, what kind of trust it is, how the income, etc is to be distributed, whether the property can be/should be sold, who the beneficiaries are and what happens at the grantor's death.