All glossary terms
Glossary term
Basis
The taxpayer's investment in property for tax purposes used to compute gain, loss, and depreciation.
Related terms
2
Jurisdictions
us
Definition
Basis generally starts at cost and is adjusted upward for capital improvements and downward for depreciation. Basis tracking is essential for computing gain or loss on disposition and for limiting deductions in partnerships and S corporations.
Examples
- A taxpayer who buys stock for $10,000 has $10,000 basis; selling for $15,000 generates $5,000 gain.
Related terms
Translations
ESbase
ZH基础
DEBuchwert
FRbase
JA基準額
Citations
26 U.S.C. · 1011
Related citations
Computed from the cross-reference graph. Links open the related entity on this site.
This entry cites
- TermOutside Basis
- TermInside Basis
Cited by
- TermOutside Basis
- TermInside Basis
Primary sources
- IRS Publication 551Verified 2026-05-20
Important disclaimer
This library is for general tax education only. Always verify filing obligations, due dates, and tax consequences against the cited primary source or with a qualified tax professional.