[Verse 1]
When you buy a stock or sell your home
The basis tells you what you've sown
Original cost plus improvements made
That's where your tax foundation's laid
Section ten-oh-one will guide your way
Through gains and losses every day
[Chorus]
Basis is the bedrock, amount realized on top
Subtract to find your gain or loss, the calculation stops
Gifted property carries over, inherited steps up high
One-oh-one-five and one-oh-one-four, the sections that apply
[Verse 2]
Adjusted basis starts with cost
Then add improvements, nothing's lost
Depreciation taken out
That's what adjustment's all about
From purchase price to selling day
Adjustments change along the way
[Chorus]
Basis is the bedrock, amount realized on top
Subtract to find your gain or loss, the calculation stops
Gifted property carries over, inherited steps up high
One-oh-one-five and one-oh-one-four, the sections that apply
[Bridge]
When Grandma gives you property with love
Her basis follows like a dove
But if she passes, stepped-up rules
Fair market value breaks the old-school tools
Multiple assets need division
Allocate with precision
[Verse 3]
Dual basis for the gifted gain
Use donor's number, not your pain
But for a loss, fair market price
At gift time makes the sacrifice
Death brings a cleaner slate around
Fair market value, newly crowned
[Chorus]
Basis is the bedrock, amount realized on top
Subtract to find your gain or loss, the calculation stops
Gifted property carries over, inherited steps up high
One-oh-one-five and one-oh-one-four, the sections that apply
[Outro]
From cost to sale, the basis tells the tale
In tax computations, it will never fail