Question

The term 'recomputed basis' means, with respect to any property, its adjusted basis recomputed by adding thereto all adjustments reflected in such adjusted basis on account of deductions (whether in respect of the same or other property) allowed or allowable to the taxpayer or to any other person for depreciation or amortization. What is the definition of the term 'recomputed basis'?

1) The adjusted basis of a property after recomputing all adjustments for depreciation or amortization
2) The original basis of a property before any adjustments for depreciation or amortization
3) The adjusted basis of a property without any adjustments for depreciation or amortization
4) The original basis of a property after recomputing all adjustments for depreciation or amortization

Answer 1

The recomputed basis is the adjusted basis of a property after accounting for depreciation or amortization.

Step-by-step explanation:

The term 'recomputed basis' refers to the adjusted basis of a property after recomputing all adjustments for depreciation or amortization. It takes into account the deductions allowed or allowable to the taxpayer or any other person for depreciation or amortization. In other words, it is the original basis of a property after accounting for any changes due to depreciation or amortization.