Sale (Disposition) of Assets
You dispose of property when you sell, exchange, abandon, give, or have your property taken away.
Gains from most sources are includable in taxable income but losses are only allowed from certain types of dispositions.
Your Tax Basis in an asset is usually the same as your Cost Basis which is generally what you paid to acquire the asset including any appropriate fees and expenses. Your Tax Basis can be adjusted (Adjusted Basis) for things such as depreciation (reduction of basis) or improvements (increase of basis).
Your basis, whether adjusted or not, is used to determine your gain or loss when you dispose of an asset.
Your gain or loss is determined by subtracting your basis from the proceeds that you received from the disposition of the asset.
Here are some other articles to read for assisting you with the disposition of your assets: