Tax Terms

Cost Basis

Definition

What is Cost Basis?

The original investment cost adjusted for specified events such as fees, splits, or reinvested distributions.

Example in practice

Sale proceeds minus cost basis determine the investment gain.

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Tax deducted at source from specified income payments before the recipient receives the balance.

Tax that may apply to gains from disposing of qualifying assets.

A public authority responsible for administering and collecting taxes.

The possibility of loss because broad market prices or rates move against an investment.

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