Trust depreciation recapture

[Farmgirl123]

Who pays the depreciation recapture?   The trust or the beneficiary?  
is it dependent on who got the depreciation deduction?   

[M-MTax]

is it dependent on who got the depreciation deduction?   

Yeah but who sold the property? Depreciation follows income.

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[Farmgirl123]

The trust sold the property but gave the recapture to the beneficiaries

[Farmgirl123]

Trust kept all the depreciation.  
recapture was distributed to beneficiaries.  

[M-MTax]

What about the actual sales proceeds?

[Farmgirl123]

Distributed to the beneficiaries as principal.

[M-MTax]

Then there should be K-1s and reporting is an issue for the beneficiaries on their returns.

[Farmgirl123]

It was distributed to the beneficiaries and was on our k-1.  
we had received none of the depreciation over the years. 
We should or should not have received the recapture or should the recapture  been kept with the trust?

Thank you. 

[M-MTax]

If you received income you should have received the depreciation. Not sure how the trustee handled this situation.

[Farmgirl123]

Thank you!

[M-MTax]

You are welcome!

[Farmgirl123]

So I am just curious.  If you have a simple trust with rental property would it be highly unlikely that the trust should have any passive losses because of depreciation and amortization?

[M-MTax]

Depreciation makes it more likely that there will be a passive loss. Not sure what you're getting at here.

[Farmgirl123]

I’m just saying that if the trust keeps all the depreciation and amortization with the trust and doesn’t distribute it to 6 beneficiaries of a simple trust that it will be more likely that there are passive losses for the trust then if they had distributed it with the income for a simple trust.   
In other words the trust kept the deductions in order to have losses?   I’m not saying that is right but I’m saying this is what would happen if you had a lot of depreciation and amortization that you didn’t distribute Ute like you were suppose to?

[M-MTax]

You need to run this by a tax pro who can examine the trust docs and past returns.