If a noncommunity property state, then 50% step up basis. In a community property state you get a 100% step up basis. In both type of states you use fair market value at day of death

But that begs the question - what was used for basis for depreciation from 2018 until the date of sale?

Same basis for depreciation. On her 2019 Single return 4562 cost or basis was put in the same 

what about the depreciation recapture?

if a community property state everything is reset at day of death, so depreciation recapture only from day of death. If not community property state, then she is responsible for 50% of depreciation recapture from original basis to day of death, and 100% from day of death until day of sale. It sounds like she did it wrong in 2019, so you may need to do a 3115. What state are you doing ?

Before the husband died, who owned it?

Everyone is assuming jointly owned and a 50% step up to wife, which would be correct in a noncommunity property state.

But if husband owned it, wife gets a 1000 100% step up.

The intestate reference made me wonder. If it was jointly owned, the intestate laws don't matter.

"Everyone is assuming jointly owned and a 50% step up to wife"

Not everyone😁

@sjrcpa Yes Guilty as charged 🙄. Glad you brought it up if not jointly owned then the rules are different.

The house was previously titled only in the husband's name, so I believe she should have received a 100% step-up and restarted depreciation at the date of death (it is not a community property state). 

What I’m trying to figure out now is how to reconcile the fact that she’s been depreciating from the old schedule for the past seven years. Is there any way to treat it as if she only needs to recapture the depreciation taken since the husband’s death, rather than going back further?

I am also trying to reconcile the fact that she benefited from the earlier depreciation while her husband was alive, since it reduced income on their joint return, and I am not sure how that could be treated when correcting it now.

The depreciation before the husband's death was buried with him (or more likely, cremated).  Stepped-up basis means forgetting about any adjustments before death.  In fact, it's not always "stepped up" -- if the husband had paid more for the property than it was worth when he died, her loss would be reduced from what he could claim, had he lived. 

It's really only six years you have to worry about, right?  She might have been claiming too little for depreciation, but since she (or her preparer) didn't know how to calculate it, she might have been claiming too much by not taking nondepreciable land into account.

And are there unused carryover losses, to be adjusted?  How much is saved, by worrying about amended returns and/or Form 3115?  Tomorrow may just be another day, to quote Scarlett O'Hara, but it's also the day tax returns are due.  

The depreciation before the husband's death was buried with him.....

2005 depreciation recapture 95,727

2018 DOD depreciation recapture 26,581

The difference owed is $20,000 if I take DOD depreciation recapture vs 2005 MFJ depreciation recapture owned by late taxpayer

The depreciation before the husband's death was buried with him.....

2005 depreciation recapture 95,727

2018 DOD depreciation recapture 26,581

The difference owed is $20,000 if I take DOD depreciation recapture vs 2005 MFJ depreciation recapture owned by late taxpayer

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@MGC94 wrote:

 

2018 DOD depreciation recapture 26,581

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Is that the amount of depreciation AFTER factoring in the Step-Up in Basis?  If she didn't take enough depreciation, you need to factor in what she SHOULD have taken (based on the Step-Up).

"I am also trying to reconcile the fact that she benefited from the earlier depreciation while her husband was alive, since it reduced income on their joint return"

That's for people elected to Congress to worry about.  Reminder:  You weren't.  

Depreciation is allowed or allowable (i.e., even if not taken correctly - right method, wrong basis?).

Thus, determine the proper amount of depreciation that should have been taken.  That should be your recapture at a higher rate (all things being equal) and make a 481a adjustment in the year of sale for the difference (i.e., boost depreciation and increase gain and recapture in year of sale).  See correcting errors on the Form 3115.  I think it is an automatic DCN 10 or 11....Schedule E.

Depending on circumstances, amended returns might yield more.  Wouldn't try to finish it by midnight so....pay and reclaim later?