Cost basis is the dollar figure on the Cost Basis column of the Annual Report — and on the Total Cost Basis card above the table. It's the number every gain/loss calculation in the report subtracts from proceeds.
This article explains how the app decides what that number is for each sold item, and why it doesn't have to ask you.
Tier access
The Annual Report itself is Premium-only, but the cost-basis tracking that drives it runs on every plan, the moment you record a sale. So even on Starter and Pro, every sale you record carries a precise, item-level cost basis with it — Premium just adds the page that surfaces it for tax season.
What cost basis means
Cost basis is what you originally paid to acquire something. When you sell, the gain or loss on that sale is proceeds minus cost basis — what you received minus what you paid. Every row of the Sales table shows both sides plus the difference.
That's the whole concept. The interesting question is how the app decides which "original purchase" applies to a given sale, especially when you've bought identical coins at different times and different prices.
The three standard methods, briefly
When someone owns multiple identical items bought at different prices and sells some of them, there are three commonly accepted ways to decide which item's price counts as the cost basis.
FIFO (First-In, First-Out): Treats the oldest item as the one sold. Default in many tracking tools.
LIFO (Last-In, First-Out): Treats the newest item as the one sold. Common in some inventory contexts.
Specific Identification: The seller designates exactly which item was sold, and that item's purchase price is the cost basis.
FIFO and LIFO are approximations — they work because most spreadsheets and brokerage systems don't track which physical unit is which, so they pick a buy-by-date order and move on.
Specific Identification is the most precise method and is broadly accepted for assets where the individual items are distinguishable from each other.
Why Gold Silver Ledger uses Specific Identification
The whole inventory model in the app is built around treating each piece of bullion as its own record. Buy ten American Gold Buffalos and you don't get a single "10 oz of Gold Buffalo" entry — you get ten individual items, each with its own purchase price, purchase date, and (if you've added them) nickname, reference, and date annotation.
That structure makes Specific Identification the natural fit. The app doesn't need to approximate which coin was sold by guessing at dates, because every coin already has its own identity from the moment you saved the buy.
When you sell, you pick the specific items you're selling from your holdings, and the link between each sold item and its original buy is locked in for good.
How it works when you record a sale
The mechanism is built into the Record Sale form rather than into a separate cost-basis screen. Step-by-step:
From the left nav, head to Transactions → Record Sale.
Pick the product you sold from your holdings — the form shows your held items for that product, grouped or listed depending on your view.
Tick the specific items you sold. This is the Specific Identification step — every box you tick is a coin or bar whose cost basis you're committing to.
Enter the sale price per unit and the sale date, plus any optional fields (dealer, notes, name).
Save the sale.
From that point forward, each selected item's purchase price travels with it: into the Sales table, into the Cost Basis column, into the gain/loss calculation, and into the year's totals on the headline cards.
For the full Record Sale walkthrough, see How to record a sale.
What gets included in cost basis
The cost basis for a sold item isn't just the spot price at the time of purchase — it's the all-in per-unit cost locked into that item when you originally saved the buy. That includes:
Premium over spot: Whatever you paid above spot. The buy form takes premium-per-unit as input, and the resulting per-unit price (spot plus premium) is what travels with the item.
Allocated shipping: Any shipping or handling cost you entered on the buy was distributed across the items in that transaction when you saved it. Each item carries its share into cost basis from then on.
So a 1 oz American Gold Buffalo bought at ~$4,700 spot with a $90 premium and $1 of allocated shipping arrives in your inventory with a $4,791 cost basis, and that's the figure that appears in the report when you eventually sell it.
A worked example
Where Specific Identification really earns its keep is in cases where you've bought the same product more than once at different prices. Imagine you own two 1 oz American Gold Buffalos, both bought in the same portfolio:
Coin A: Bought Jan 2025 at $3,800 cost basis.
Coin B: Bought Jan 2026 at $4,790 cost basis.
Spot is around $4,850 today, and you sell one coin for $4,850.
Three different methods give three different gain figures for the same sale:
FIFO (not used by GSL): Sells Coin A → cost basis $3,800 → gain $1,050.
LIFO (not used by GSL): Sells Coin B → cost basis $4,790 → gain $60.
Specific Identification (what GSL uses): You picked the coin when you recorded the sale → cost basis is whichever coin you ticked → gain is whichever number applies to that coin.
The choice between Coin A and Coin B has real consequences for the gain/loss reported, and the holding period (short-term vs. long-term — see Short-term vs. long-term gains explained) can swing too, since Coin A is long-term and Coin B is short-term in this scenario.
The app's job is to make sure the selection is preserved exactly as you made it. The strategy question — which coin to sell, and when — is a conversation for you and a tax advisor.
A note on selection and tax planning
Because Specific Identification gives you control over which item's cost basis applies to each sale, there's room for thoughtful selection — picking items with longer holding periods to qualify for long-term treatment, picking higher-cost items to reduce reported gain, or picking lower-cost items to harvest a longer-term position.
None of that is something the app advises on; it's just a downstream consequence of using the most precise method.
Where to go next
How to record a sale: The full Record Sale walkthrough.
How the Annual Report autofills your data: Where each value in the report comes from.
Short-term vs. long-term gains explained: The other axis the report splits along.
Generating your Annual Report: Walkthrough of the page itself.
Why you should still consult a tax advisor: The disclaimer, unpacked.