avoiding capital gains on sale of Real estate owned by a Trust

In 2018 we started a Trust through a self directed 401K. We used the Trust to purchase a rental real estate. We retired and in 2021 we sold the property and transfer the entire Trust account balance into a traditional IRA. I'm using Turbotax to complete the Trust's 1041 and it is calculating a large capital gain. I'm not sure how to make it reflect the transfer of funds to the IRA.

posted

If you are preparing a 1041 for the trust and are indicating that the property was sold rather than rolled over (transferred to another trustee), then TurboTax is going to calculate the difference between the selling price and your basis.