Tax Treatment of Personal/Business Property After Spouse Passes

[Damian S.]

My grandmother recently received my grandfather's half interest in a 4- flat as the surviving spouse. One of the apartments had been used as their principal residence and continues to be used by my grandmother. The remaining portion of the property or 75% had been depreciated for the past 16 years. Now my question is whether after my grandfather's passing half the interest in the property received a step-up in basis or just the half interest in the principal residence portion. The property is also not located in a community property state. Thank you in advance for input.