FindLaw Legal Dictionary
The FindLaw Legal Dictionary -- free access to over 8260 definitions of legal terms. Search for a definition or browse our legal glossaries.
pl: ba·ses [-sēz]
1 : something (as a principle or reason) on which something else is established [the court could not imagine any conceivable for the statute] see also rational basis
2 : a basic principle or method
: the principle or method by which taxable income is calculated NOTE: The Internal Revenue Code has set some limits on which method a taxpayer may use for figuring taxable income. For example, a corporation with gross receipts under $5,000,000 may be a cash-basis taxpayer.
: a method of accounting in which income and expenses are recorded in the period when they are earned or incurred regardless of when the payment is received or made called also accrual method
: a method of accounting in which income and expenses are recorded in the period when payment is received or made called also cash method
3 : the value (as cost or fair market value) of an asset used in calculating capital gains or losses for income tax purposes
: the basis of an asset increased or decreased to reflect changes in value (as through improvement or depreciation)
: the basis of a donated or transferred asset that is equal to the basis of the asset when it was in the hands of the donor or transferor NOTE: Carryover basis is generally applied to gifts, transfers in trust, and property acquired from a decedent.
: the basis of an asset equal to the amount paid for the asset plus other acquisition costs (as a brokerage fee)
: a basis (as a carryover or cost basis) that is increased (as to fair market value) by other than an improvement or depreciation adjustment
: the basis of property received in exchange for property of a like kind that is equal to the basis of the property given with adjustments for additional consideration received or gains and losses realized
Source: Merriam-Webster's Dictionary of Law ©1996. Merriam-Webster, Incorporated. Published under license with Merriam-Webster, Incorporated.