The new home is a trust asset that isn't reported on Form 1041. The remaining cash/CD is also a trust asset, again not reportable. However, the trust may owe taxes on the capital gains from the sale of the original home. Purchasing a new home wouldn't affect that taxable income.
To see how the tax is calculated, click the Forms icon in the TurboTax header and open Form 1041. Scroll down to Schedule G to review the tax computation. Also check Schedule D, which is the form that reports the home sale.
Because an irrevocable trust is generally not eligible for the home sale exclusion available to individuals, you may wish to consult with a local tax attorney to discuss your options. There are exceptions that an attorney may pursue to reduce or eliminate the tax on the capital gain from the sale of the home.
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