I believe you need to take this issue up with your accountant directly; it is just too involved. The accountant may have erred in entering the amount paid or distributed on Schedule B, Line 10 since the trust did not distribute the proceeds to the beneficiaries, the title company did (from what I was able to glean).
However, it appears as if all of this is going to be a wash, of sorts. If the beneficiaries enter the proceeds from their 1099-S forms (which will be a wash since the proceeds and basis are essentially the same) and the information from the K-1, nothing should change; the K-1 appears to only contain final year deductions.
Again, you should speak with your accountant regarding the entire matter.
