||2001 Tax Year
Basis is the amount of your investment in property for tax
purposes. Use the basis of property to figure depreciation,
amortization, depletion, and casualty losses. Also use it to figure
gain or loss on the sale or other disposition of property. You must
keep accurate records of all items that affect the basis of property
so you can make these computations.
This publication is divided into the following three sections.
- Cost Basis.
- Adjusted Basis.
- Basis Other Than Cost.
The basis of property you buy is usually its cost. You may also
have to capitalize (add to basis) certain other costs related to
buying or producing the property.
Your original basis in property is adjusted (increased or
decreased) by certain events. If you make improvements to the
property, increase your basis. If you take deductions for depreciation
or casualty losses, reduce your basis.
You cannot determine your basis in some assets by cost. This
includes property you receive as a gift or inheritance. It also
applies to property received in an involuntary conversion and certain
Comments and suggestions.
We welcome your comments about this publication and your
suggestions for future editions.
You can e-mail us while visiting our web site at
You can write to us at the following address:
Internal Revenue Service
Technical Publications Branch
1111 Constitution Ave. NW
Washington, DC 20224
We respond to many letters by telephone. Therefore, it would be
helpful if you would include your daytime phone number, including the
area code, in your correspondence.
First | Next
Publication Index | IRS-Forms Main | Home