Tax Terms
Cost Basis
Definition
What is Cost Basis?
The original investmentAn asset or commitment of money made with the expectation of future income, growth, or both. cost adjusted for specified events such as fees, splits, or reinvested distributions.
Example in practice
How This Looks in Practice
Sale proceeds minus cost basis determine the investment gain.
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Related Terms
Tax Terms
Withholding Tax
Tax deducted at source from specified income payments before the recipient receives the balance.
Tax TermsCapital Gains Tax
Tax that may apply to gains from disposing of qualifying assets.
Tax TermsTax Authority
A public authority responsible for administering and collecting taxes.
Risk TermsMarket Risk
The possibility of loss because broad market prices or rates move against an investment.