You most likely should have filed a gift tax return (Form 709) when you gave your share of the property to your sister in 2012.
Your sister should file a gift tax return for the 2021 calendar year.
Everything, starting from the period of your sister's sole ownership until the time she gifted the property to you will carry over to your ownership. That would include depreciation deductions taken (or which should have been taken) during the period(s) of rental use - note that the recapture of those depreciation deductions will not be shielded by the ($250k) home sale exclusion.
You should consult, in person, with a local tax professional and/or legal counsel.
