Thank You CHAMP. I do live in a community state and the rental was almost fully depreciated prior to my spouse's death. It makes a huge difference if I do not have to recapture depreciation on our joint returns over 20 years prior to his death.
I raised the question because I consulted a tax professional. She showed me Form 4797 and that prior depreciation has to be added to Line 22. She added that Stepped Up Basis does not mean Stepped Up depreciation. I was suspicious because that was contrary to what I had read. It would also be unfair because prior depreciation was taken on MFJ tax rate before my spouse's death. If it had to be recaptured upon sale after his death, the recapture would be taxed on my current Single rate.
Many Thanks again.
