diff --git a/src/System.Management.Automation/utils/EncodingUtils.cs b/src/System.Management.Automation/utils/EncodingUtils.cs
index 060b052f744..cdb467d213a 100644
--- a/src/System.Management.Automation/utils/EncodingUtils.cs
+++ b/src/System.Management.Automation/utils/EncodingUtils.cs
@@ -115,6 +115,8 @@ internal sealed class ArgumentToEncodingTransformationAttribute : ArgumentTransf
     {
         public override object Transform(EngineIntrinsics engineIntrinsics, object inputData)
         {
+            inputData = PSObject.Base(inputData);
+
             switch (inputData)
             {
                 case string stringName:
diff --git a/test/powershell/engine/Basic/Encoding.Tests.ps1 b/test/powershell/engine/Basic/Encoding.Tests.ps1
index dc1a0b15ba2..455c7e2ddea 100644
--- a/test/powershell/engine/Basic/Encoding.Tests.ps1
+++ b/test/powershell/engine/Basic/Encoding.Tests.ps1
@@ -89,6 +89,8 @@ Describe "File encoding tests" -Tag CI {
         It "Parameter 'Encoding' should accept '<encoding>'" -TestCases @(
             @{ encoding = 1251 }
             @{ encoding = "windows-1251" }
+            # Piping the string creates a PSObject boxed value that we are testing.
+            @{ encoding = ("windows-1251" | Write-Output) }
         ) {
             param ( $encoding )
             $testFile = "${TESTDRIVE}/fileEncoding-$($encoding).txt"