We continue the study of regular ideals in regular inclusions of C*-algebras. Let be a regular inclusion of C*-algebras satisfying the ideal intersection property and with a faithful invariant pseudo-expectation. A complete description of the regular ideals of is given using the invariant regular ideals of and the pseudo-expectation. Further, necessary and sufficient conditions are given for a quotient by a regular ideal to preserve the faithful unique pseudo-expectation property. Special attention is given throughout to pseudo-Cartan inclusions, i.e. inclusions having a Cartan envelope. We show that the quotient of a pseudo-Cartan inclusion by a regular ideal is again a pseudo-Cartan inclusion, and we describe the Cartan envelope of the quotient.

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