How to figure the basis for this redemption? (opens in new tab)

I've been maintaining an small life insurance policy (from Uncle Sam on leaving the military), making payments every quarter for close to 60 years. The original insurance amount was $5000. The value has been going up slowly through re-investment of dividends to additional paid-up insurance, to where the face value is now some $23000, for a redemption value of ~$19000. When I surrender the policy, the company will withhold 10% of the payout for federal taxes, which sounds as if they consider 1...