@Linda48328
When paying for reserve items, the payment should be recorded as a reduction in reserve equity, not an expense (it should have been recorded as an expense when it was moved to the Reserve Equity account). That should keep it off your budget. I like to use a separate equity account called 'Capital Expenditures' and assign the payment to that. The Capital Expenditures account serves as a contra-equity account, meaning the balance in the account will always be negative. That way, reserve expenditures will be a separate line item on the balance sheet which makes it easier to read, IMO, for the board and the owners. And, it allows you to more easily locate find those costs.
