How To Figure Cost Basis On Inherited Stock. The basis, or cost basis, of a stock investment is the amount initially invested in the shares. Ordinarily, you take the average of the highest and lowest quoted selling prices on the date the original owner died to come up with the cost basis for inherited stock.
Keep in mind, estate and inheritance taxes could still apply. Thus, if you have $500 in dividends reinvested and it buys you 30 additional shares, your basis in each share would be $16.67 ($500 divided by 30). It depends on the value of the stock at the time the previous owner died.