Should I be excluding either or both sides of transactions from Checking to HSA accounts? (edited)

Question

We fund a pair of Health Savings Accounts administered by Fidelity through monthly transfers from our primary checking account for which we have created recurring Bills in Simplify.

The net effect is a pair of monthly transfers - from Checking to HSA1 and Checking to HSA2. Should I be excluding either or both sides of each transaction from the Spending Plan or Reports? If so, can this be done automatically through the recurring Bills series?

Please forgive the admitted obtuseness of the question. I clearly have been staring at this for much too long and would appreciate a nudge toward clarity.

Many thanks in advance for any helpful guidance.

Coach Natalie · Answer

@Mortimer Duke, thank you for the information!

Since you're tracking the contributions as expenses, you won't want the money coming into your HSA accounts to count as income, as that would offset the expense. With that in mind, I'd recommend excluding only the money-in side of the transfers from your budget. This way, the contributions still count toward your expenses, while the incoming transactions remain visible for tracking purposes without affecting your budget.

That's my advice for the Spending Plan. As for reports, I think it depends on your intent when running them. Does the information provided above help with that as well?

We look forward to hearing back from you!

Mortimer Duke · Answer

Thanks, Kristina.

Since we are funding the contributions from cash flow (checking) rather than payroll deduction, they are a budgeted expense.

On the HSA account side, tracking the contributions is important because they're both subject to annual contribution limits and tax deductible.

Coach Kristina · Answer

Hello @Mortimer Duke,

Thank you for reaching out with this question! Because transfers are usually neither income nor an expense, they are excluded from reports and from the Spending Plan by default. For more information, see these articles:

https://support.simplifi.quicken.com/en/articles/5142302-handling-transfers-in-the-spending-plan

&

https://support.simplifi.quicken.com/en/articles/14812140-handling-transfers-in-reports

Is there a reason that you need one or both sides to appear in a specific report or in your spending plan?

I look forward to your reply!