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LSDefine

Simple English definitions for legal terms

cost basis

Read a random definition: de coelo usque ad inferos

A quick definition of cost basis:

Cost basis is the original cost of buying something, like a house or stock, for tax purposes. It helps you figure out how much money you made or lost when you sell it. If you get a gift, your cost basis is the same as the person who gave it to you. If you buy something at different times and prices, you have to use the first-in, first-out method to figure out your cost basis. If you reinvest your profits, your cost basis goes up, which can lower your taxes.

A more thorough explanation:

Definition: Cost basis, also known as tax basis, refers to the original cost of acquiring a property for tax purposes. This includes the purchase price of the property as well as any commissions or fees associated with the purchase. It is primarily used to calculate capital gain or loss when transferring property and can be expressed as either a dollar amount or per share price.

For example, if you purchase a stock for $50 per share and later sell it for $75 per share, your capital gain would be $25 per share. However, if you had reinvested dividends and capital gains distributions, your cost basis would be higher, resulting in a lower capital gain and tax liability.

The cost basis is also used to determine the difference between the spot or current price and future price of a commodity. For instance, if you purchase a barrel of oil for $50 and sell it for $75, your cost basis would be $50.

When assets are purchased at different times and prices, the IRS requires the use of the first-in, first-out (FIFO) accounting method to determine the cost basis. Additionally, if a gift is given, the beneficiary's cost basis is the same as the original holder who gave the gift.

Overall, cost basis is an important concept for calculating capital gains and losses and determining tax liability.

cosigner | cost bill

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THATS SO FUNNY
i cant i would go crazy
JumpySubsequentDolphin
20:50
i need to know who decided to do that.
JumpySubsequentDolphin
20:50
omg im on a plane weeeee
the devil
youre on a plane??? LSD made the mile high club??
20:50
yo splitterus are you in school already
20:50
it says ur c/o 2027
JumpySubsequentDolphin
20:51
@SplitterusClitterus: HAHAH yes
ur user is hilarioussss and no i just graduated this may and am now applying ---also im out of messages so ill take a lil
20:52
roger dat. see u in heck
im back, r u applying this cycle too
JumpySubsequentDolphin
21:32
this child fell asleep on me
JumpySubsequentDolphin
21:32
im so uncomfortable
just push him off the entire seat
JumpySubsequentDolphin
21:34
LMAOOOO
JumpySubsequentDolphin
21:35
no he’s literally like 8 and he fully just put his head on my bicep and slept
JumpySubsequentDolphin
21:35
he has since moved
22:12
@SplitterusClitterus: me yesterday
gulc baby pls text me back... i miss you ...... :(
22:23
i just went into a discord vc and yelled "YALL I JUST GOT INTO J.M. SCHOOL OF LAW"
22:24
people were getting excited :sob:
22:25
then someone was like "what does jm stand for" and i was like .. well
AHHAHAHAHAHAHHAHAHAHAHAHAH
@JumpySubsequentDolphin: wait this is so cute, also where r u going
JOE MBIDEN
JumpySubsequentDolphin
22:39
@splitty Oregon!
oh yay for what thats so random
JumpySubsequentDolphin
22:45
haha my brother and sister in law live there
so cutie oregon is beatiful
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