Arizona Other State Tax Credit

Lacerte is not properly calculating the Arizona Other State Tax Credit when there is Arizona PTET . 

According to AZ publication 713.  

“Are there credit ordering rules for the PTE credit? Arizona does not have statutory credit ordering rules. In most cases, the Credit for Taxes Paid to Another State or Country (Arizona Form 309) is computed after all other credits have been applied, however that is not the case with the PTE tax credit (Arizona Form 355). In order to give proper effect to the PTE tax credit, please follow the instructions on line 7 of Arizona Form 309.”

And per the instructions for line 7 of Arizona Form 309:

If you received distributed income from a partnership and/or S Corporation (the Entity) reported on Schedule K-1 or K-1(NR) and the Entity elected to pay Entity-Level Income Tax on your pro-rata share of the distributed income, enter the total taxes paid from the following:
•tax amount paid on your Arizona income tax form (see box above); and
• your pro-rata share of the tax paid by the Entity on your behalf. This tax amount is limited to the amount actually paid by the Entity or the amount of the other state’s individual income tax had the Entity not elected to pay the tax at the entity level, whichever is less.

However Lacerte is reflecting the tax after reducing for the AZ PTET credit on Line 7, and not adding it back to account for the special treatment of the nonrefundable AZ PTET credit, resulting in a much lower and incorrect Arizona Other State Tax Credit for taxes paid to other states.  I cannot find an override and may need to paper file the return making adjustments via Adobe to the forms.  I called Lacerte over two weeks and it was to be escalated, but I have not heard back.