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Simple English definitions for legal terms

cost basis

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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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Dkk
19:42
SEO is big money
2016 pushed the conservative party into populism irreversibly
Dkk
19:43
Maybe, but if this is populism, then every election is populist.
19:43
@Dkk: yeah register 1 website and every swinging tom dick and harry calls/emails/texts to 'help with seo'. like bruh, if YOU found it, what i am doing is working
Dkk
19:43
Indeed!
19:48
wasp, i think people are hopeful for a gov who at least attempts to care about the common man
MIAMI A
[] AromaticTroubledDormouse
20:55
How does one know if they are UR1 or UR2?
[] AromaticTroubledDormouse
20:56
CONGRATS MACAQUE!
TY
got a random stanford email and almost had a heart attack
ALSO CONGRATS!
Congrats1!
21:15
Miami A, yall I'm so excited I could cry.
21:15
Feel like I can finally stop holding my breath!! Whew!!!
[] baddestbunny
22:16
every time I get accosted by a strange man who follows me around because my male coworkers were too busy talking to walk me back to my car I get closer to saying we need to bring back traditional gender roles
Dkk
22:32
Nice! @Macaque
Dkk
22:32
@Aromatic, Have to guess.
Dkk
22:33
That sucks @Bunny do you have to go to the hospital?
[] baddestbunny
22:40
I said accosted not assaulted
23:35
guys. my notre dame address just went long is this good or bad
1a2b3c4d26z
23:37
Oooooo me too
23:37
omg is this good or bad
Dkk
23:47
Idk if gender roles are gunna fix that then.
23:49
it looks like most people who applied in october last cycle didn't get a decision until january... does it even mean anything that our addresses went long??
hows ED 2 compared to ED 1?
Dkk
0:10
No idea
windyMagician
0:34
reporting live to say my ndls address also went long
does it mean anything ^
Dkk
2:21
NDLS and Fordham took a very long time last year. It's good info for people to know.
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