Pub 946 Compliance

server/services/disposals.js

@@ -1,5 +1,5 @@
 const { all, audit, now, one, run, tx } = require('../db');
-const { annualSchedule, money } = require('../depreciation');
+const { annualSchedule, money, section280fRecapture } = require('../depreciation');
 const { ruleSetForBook } = require('./ruleSets');
 const { hydrateAsset } = require('./assets');
 
@@ -30,6 +30,44 @@ function bookFor(asset, bookType) {
   return asset.books.find((book) => book.book_type === bookType) || asset.books[0] || { book_type: bookType };
 }
 
+// Real property (§1250) vs personal property (§1245), by recovery period: 27.5-year residential rental
+// and 39-year nonresidential real property are §1250; everything else is §1245.
+function isRealProperty(asset, book) {
+  const months = Number(book.useful_life_months || asset.useful_life_months || 0);
+  const pt = String(asset.property_type || '').toLowerCase();
+  return months >= 330 || /real|realty|1250|building/.test(pt);
+}
+
+// Characterize the gain on disposal into ordinary-income recapture vs. §1231 (capital) gain (Form 4797).
+// §1245: ordinary recapture = lesser of gain or total depreciation taken (incl. §179/bonus). §1250:
+// ordinary recapture = lesser of gain or "additional depreciation" (accelerated over straight-line); the
+// remaining gain up to straight-line taken is unrecaptured §1250 gain (a 25% capital bucket).
+function characterizeRecapture(asset, book, rules, year, proportion, gainLoss, accumulated) {
+  const section = isRealProperty(asset, book) ? '1250' : '1245';
+  const gain = Math.max(0, gainLoss);
+  let ordinary = 0;
+  let unrecaptured1250 = 0;
+  if (gain > 0) {
+    if (section === '1245') {
+      ordinary = Math.min(gain, accumulated);
+    } else {
+      // Straight-line accumulated for the same period (additional depreciation = accelerated − SL).
+      const slBook = { ...book, depreciation_method: 'straight_line', section_179_amount: 0, bonus_percent: 0 };
+      const slRow = annualSchedule(asset, slBook, rules, { startYear: year, endYear: year })[0] || {};
+      const slAccum = money(Number(slRow.accumulated || 0) * proportion);
+      const additional = Math.max(0, money(accumulated - slAccum));
+      ordinary = Math.min(gain, additional);
+      unrecaptured1250 = Math.min(money(gain - ordinary), slAccum);
+    }
+  }
+  return {
+    recapture_section: section,
+    ordinary_recapture: money(ordinary),
+    unrecaptured_1250_gain: money(unrecaptured1250),
+    section_1231_gain: money(gainLoss - ordinary) // negative for a §1231 loss
+  };
+}
+
 function computeDisposal(asset, input = {}) {
   const bookType = input.book_type || 'GAAP';
   const book = bookFor(asset, bookType);
@@ -55,6 +93,10 @@ function computeDisposal(asset, input = {}) {
   const realized = money(price - expense);
   const gainLoss = money(realized - netBookValue);
 
+  // Recapture characterization is computed on the disposed book's depreciation (use a tax book — FEDERAL —
+  // for tax recapture). "Depreciation taken" includes the impairment write-down already reflected in NBV.
+  const recapture = characterizeRecapture(asset, book, rules, year, proportion, gainLoss, money(accumulated + impairment));
+
   return {
     book_type: bookType,
     disposal_date: disposalDate,
@@ -69,7 +111,8 @@ function computeDisposal(asset, input = {}) {
     impairment,
     net_book_value: netBookValue,
     realized,
-    gain_loss: gainLoss
+    gain_loss: gainLoss,
+    ...recapture
   };
 }
 
@@ -79,7 +122,18 @@ function previewDisposal(assetId, input) {
   return computeDisposal(asset, input);
 }
 
+// §280F recapture preview for a listed/passenger asset converting to ≤50% business use in a given year.
+function previewSection280fRecapture(assetId, input = {}) {
+  const asset = hydrateAsset(assetId);
+  if (!asset) return null;
+  const bookType = input.book || 'FEDERAL';
+  const book = bookFor(asset, bookType);
+  const year = Number(input.year) || new Date().getFullYear();
+  return section280fRecapture(asset, book, ruleSetForBook(bookType), year);
+}
+
 function recordDisposal(assetId, input, userId) {
+  require('./midQuarter').clearCache();
   const asset = hydrateAsset(assetId);
   if (!asset) return null;
   const result = computeDisposal(asset, input);
@@ -91,13 +145,15 @@ function recordDisposal(assetId, input, userId) {
       `INSERT INTO disposals (
         asset_id, disposal_date, method, property_type, partial, disposed_cost,
         disposal_price, disposal_expense, accumulated_depreciation, net_book_value,
-        gain_loss, book_type, notes, created_by, created_at
-      ) VALUES (?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?)`,
+        gain_loss, book_type, recapture_section, ordinary_recapture, section_1231_gain,
+        unrecaptured_1250_gain, notes, created_by, created_at
+      ) VALUES (?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?, ?)`,
       [
         assetId, result.disposal_date, result.method, result.property_type, result.partial,
         result.disposed_cost, result.disposal_price, result.disposal_expense,
         result.accumulated_depreciation, result.net_book_value, result.gain_loss,
-        result.book_type, input.notes || null, userId, timestamp
+        result.book_type, result.recapture_section, result.ordinary_recapture, result.section_1231_gain,
+        result.unrecaptured_1250_gain, input.notes || null, userId, timestamp
       ]
     );
 
@@ -127,6 +183,7 @@ function recordDisposal(assetId, input, userId) {
 }
 
 function reverseDisposal(assetId, disposalId, userId) {
+  require('./midQuarter').clearCache();
   const disposal = one('SELECT * FROM disposals WHERE id = ? AND asset_id = ?', [disposalId, assetId]);
   if (!disposal) return null;
   guardSubledger(assetId, disposal.disposal_date);
@@ -191,6 +248,7 @@ module.exports = {
   deleteAdjustment,
   netAdjustments,
   previewDisposal,
+  previewSection280fRecapture,
   recordAdjustment,
   recordDisposal,
   reverseDisposal