If you entered U in option 8227 "Tax Exemption – Applies to what items?", use this POS option in Options Configuration to enter the value of the User Code field (or Expanded Codes) that you'll use to identify tax exempt items. This option is used in conjunction with option 8228 "Tax Exemption - Use Code position to identify what items ."
For example, you could enter the code "T" in this field. In Inventory Maintenance, you'd then place a "T" in a particular position of the User Code field for each tax-exempt item (you define the position in option 8228 "Use Code position to identify what items").