Quote Originally Posted by Rapid Robert View Post
I think you're wrong about that. If it's a trustee to trustee transfer, I don't think it would even show up on page 1 of Form 1040, or at worst it would be a 1099-R code G rollover (not taxable). Or, even if it was a taxable distribution, then you would get the offsetting HSA deducton for your contribution.
That makes sense and I concur. But why not just make a normal HSA contribution and take the deduction if other funds are available? Again, as Kathy said, it only seems to make sense if no other monies are available to fund the HSA.