Cost Basis
Contents
Cost basis is sometimes referred to as tax basis. Advisors Assistant tracks the Cost Basis on all assets regardless of their tax implications. Without tracking the basis, we could not show unrealized gains and perform other gain calculations.
It's true, technically, an asset in some IRAs has no Cost Basis as it may be defined in tax law. We will leave the tax law to the lawyers and accountants and concentrate on the calculations.
Definition
Purchase price, including commissions and other expenses, used to determine capital gains and capital losses for tax purposes.
For a purchased investment, the basis is the amount paid
If inherited, the basis is the value of the stock on the date of the original owner's death.
If received as a gift, the basis is the amount that was originally paid for the investment, unless the market value of the investment on the date the gift was given was lower
The cost of an asset used to determine tax liabilities. This number is the purchase price, including capital gains and losses, accrued interest, and other fees. also called tax basis.
The difference between the cash price and the futures price of a given commodity.
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