Cost Basis (Investments & Retirement) - Definition, Examples, Advice | Bolder Money

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Definition

The original value or purchase price of an asset, used to determine your gain or loss when you sell it.

What to consider

Keep detailed records of the purchase price of your investments.
Use cost basis to calculate gains or losses for tax purposes.
Review it when planning to sell an asset for accurate reporting.

Real world scenarios

Before selling some shares, Rachel calculated the cost basis to determine how much profit she would need to report for capital gains taxes.

Related terms

Investments & Retirement

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