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adjusted basis

   Also found in: Legal, Wikipedia 0.01 sec.
Adjusted basis
Price from which to calculate and derive capital gains or losses upon sale of an asset. Account actions such as any stock splits that have occurred since the initial purchase must be accounted for.

adjusted basis
The acquisition cost of an asset after it has been adjusted to reflect changes in cost basis that result from the occurrence of certain events following the day of acquisition. For example, stock dividends, stock splits, and dividends deemed to be returned on capital cause a downward adjustment in the cost basis of a security. Conversely, commissions result in an upward adjustment in the cost basis. Adjusted basis is used in calculating gains and losses for tax purposes.

adjusted basis

A tax and accounting term referring to the original acquisition cost of a property, with the following adjustments:

• Depreciation, which reduces the basis

• Capitalized closing costs, which increase the basis

• Capital improvements, such as a new roof, which increase the basis

The difference between the adjusted basis and the ultimate sale price of a property will be the taxable profit on the sale.The adjusted basis is an extremely important tax concept,and one which it is important to master in order to comfortably evaluate properties.


Adjusted Basis
The cost or other original basis of property reduced by adjustments such as depreciation allowed or allowable and casualty losses, and increased by the cost of capital improvements, expenses of purchase, and other adjustments.


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? Mentioned in ? References in periodicals archive
 
The realized gain or loss is the difference between the amount realized and the taxpayer's adjusted basis in the property; no COD income is realized.
The adjusted basis is generally defined as the purchase price, minus the value (or cost) of the land, plus the value of any capital improvements made since the building acquisition, minus any depreciation already claimed.
When the basis of the notes was added to the basis of the other contributed property, the amount of the transferred liabilities did not exceed the adjusted basis.
 
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