The rental is in her trust, NOT her estate. There is a difference.
Anyway, assuming the trust was a grantor trust while she was alive and became irrevocable (nongrantor) when she passed, the trust will get a stepped up basis and there will be no depreciation recapature at that point.
If the trust continues to use the property for rental use, depreciation will start over on the date of death at a new recovery period and basis (FMV on the date of death).
The trust would deduct any selling costs from the sales price first. If the property is being used for business/rental purposes at the time of the sale, any net loss on that sale could be used to offset other trust income.
