Yes, you would have thought Lacerte would have made this easier and I sure would have thought they would be able to explain the solution when calling them. I was on an hour and a half with Lacerte with no results.

In any case, if you take this solution then you will want to make the 'other income' m-1 adjustment is made to 'tax exempt income on the books not on schedule k'. You have to use 'tax exempt' in order to keep the basis schedule correct.