Hello,
Thank you for posting in Q&A forum.
The error usually comes when the destination server is unavaialble.
1.First you can check the network connectivity by below PowerShell command:
Test-NetConnection -ComputerName <VM IP address> -Port 3389
2.If the network connectivity is normal, please restart the destination VM server manually and reconnect.
Please feel freee to let us know if there's any further concern.
Best Regards
Zunhui