As a beneficiary of an irrevocable trust holding real estate, how is receipt of rental income and principal/interest payments treated? Is it only taxed upon distribution?

Unlike a revocable trust, an irrevocable trust is treated as an entity that is legally independent of its grantor for tax purposes. Accordingly, trust income is taxable, and the trustee must file a tax return on behalf of the trust. This is filed on Form 1041 and TurboTax has a business software that will accommodate business returns. TurboTax Business

Tax returns are due when there is income earned by the trust.

Distributions to beneficiaries of an irrevocable trust, are taxable to beneficiaries at ordinary income tax rates.

For more information about the trust return you can use this link: Instructions for Form 1041.