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Employee's cost basis
In
the United States, an amount that is subtracted
from the total amount of a distribution to a pension
plan participant, in order to determine the portion
of the distribution that is subject to federal taxation.
The cost basis is the amount on which an employee
has already been taxed. It includes the amount of
the nondeductible contributions made to the plan
by the participant, any cost of plan-provided life
insurance that was reported as taxable income by
the participant, and other factors, including the
amount of any employer contributions previously
taxed as income to the participant. |
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