If you have no gain or loss, you have nothing to report on your taxes. If you sell something for more than your "basis" in the item, then the difference is a capital gain, and you’ll need to report that gain on your taxes. Your basis is usually what you paid for the item. It includes not only the price of the item but any other costs you had to pay to acquire it, including:
- Sales taxes, excise taxes and other taxes and fees
- Shipping and handling costs
- Installation and setup charges
In addition, money spent on improvements that increase the value of the asset can be added to your basis. Depreciation of an asset can reduce your basis.
