[Verse 1] When you buy a house or stock or car Your cost basis tells you where you are It's the price you paid to get it done Plus improvements when it's all said and done But basis changes through the years Depreciation makes it clear Adjusted basis is the key To calculate what profit you'll see [Chorus] Basis in, basis out That's what Section Ten-Oh-One's about Amount realized minus basis true Equals gain or loss for me and you Gift it, inherit, buy or sell Basis rules will serve you well One-Oh-Fourteen, One-Oh-Fifteen The clearest tax code you've ever seen [Verse 2] When someone gives you property It's not as simple as can be The donor's basis carries through That's carryover basis for you But if the value's fallen down A dual-basis rule comes around Donor's basis for the gain Fair market value for the pain [Chorus] Basis in, basis out That's what Section Ten-Oh-One's about Amount realized minus basis true Equals gain or loss for me and you Gift it, inherit, buy or sell Basis rules will serve you well One-Oh-Fourteen, One-Oh-Fifteen The clearest tax code you've ever seen [Bridge] Death brings a different game Stepped-up basis breaks the chain Fair market value on that day Wipes the old basis away When you buy a bundle deal Allocate to make it real Relative fair market weight Makes each asset's basis straight [Verse 3] Multi-assets in one buy Don't let the math make you cry Take the total that you paid Allocate by value grade If the building's worth twice the land Two-thirds basis is what you'll command Proportion rules the allocation game Every asset gets its claim [Chorus] Basis in, basis out That's what Section Ten-Oh-One's about Amount realized minus basis true Equals gain or loss for me and you Gift it, inherit, buy or sell Basis rules will serve you well One-Oh-Fourteen, One-Oh-Fifteen The clearest tax code you've ever seen [Outro] Remember these three simple ways Carryover gift, stepped-up death, cost basis pays Adjust it up, adjust it down Basis is the best friend you've found
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