After making a capital addition to her business asset, what must Amy adjust her basis for in terms of the building?

When a capital addition is made to a business asset such as a building, it is crucial for Amy to adjust her basis appropriately to reflect the total investment she has in that asset. The basis of the asset is generally understood as the original cost of the asset plus any costs associated with its acquisition, including improvements that add value or extend its useful life.

By including both the original cost of the building and any accumulated depreciation, Amy is ensuring that her basis accurately reflects the total investment she has made. This adjusted basis will be important for calculating gains or losses if she sells the property in the future. The depreciation reduces her taxable income over the asset's lifespan, but for purposes of calculating the basis in the asset at the time of sale, the original cost and any capital additions made need to be considered together. Hence, including the original cost and any depreciation is the correct approach to adjusting her basis.