554
Opinion of the Court
"mineral deposit" as contained in § 614. Thus the definitional scheme suggests strongly that the "property" we are concerned with in § 57(a)(8) excludes just those improvements that the Hills wish to treat as part of the property's adjusted basis.
They assert, however, (and the Government does not dispute) that the term "mineral enterprise" occurs in only that one operative provision in the regulations, Treas. Reg. § 1.611-1(d)(4), which concerns the allocation of a portion of the cost of a mineral enterprise to a mineral deposit or deposits. On that basis, the Hills argue that the term has the limited function of "assist[ing] in identifying depletable and depreciable costs when an operating mineral property is acquired as a unit." Brief for Respondents 18, n. 21. Consistently with that view, they note, a regulation implementing § 57(a)(8) directs us to "see section 1016 and the regulations thereunder . . . [f]or the determination of the adjusted basis of the property." Treas. Reg. § 1.57-1(h)(3). The computation of adjusted basis under 26 U. S. C. § 1016 (1976 ed. and Supp. V), they argue, is independent of the definition and function of "mineral enterprise" in the § 611 regulations; thus, the implications of this term's definition do not extend to the calculation at issue in this case.
We agree that § 1016 is the proper place to look for the rules concerning adjustment of basis; but we conclude that the computation of adjusted basis under § 1016 is wholly predicated on, rather than independent of, an understanding of "mineral deposit" as distinct from "improvements" within the meaning of the regulations under § 611.
Section 1016 is one of a number of general provisions that together determine the amount of gain or loss a taxpayer must recognize when he sells or otherwise disposes of any type of property. Section 1001(a) provides the basic rule: gain or loss is determined by subtracting "adjusted basis" from "amount realized." Section 1011(a) defines "adjusted basis" as "basis (determined under section 1012 [or other
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