Cost basis analysis is the process of calculating the value of an asset for tax purposes. It is a critical element of strategic financial planning and involves analyzing all relevant expenses you incur when acquiring, managing, or disposing of an asset. By understanding your costs, you can make informed decisions on how to maximize the profits from your investments. It also ensures that you are able to report accurate information to the IRS and other government agencies. Cost basis analysis gives you an accurate picture of the costs associated with your assets, so you can make informed decisions about the best way to invest your money.