You need to make an existing transaction exempt in the Admin Console.
- Open the transaction, click Edit > type in the exemption (such as 'Exempt') in the Exemption No. field (not required if you created an exemption profile for the customer already) > choose an adjustment reason > click Calculate to see tax updated to $0
- Click Save as Committed to save the change
Note: If you have exemptions set as required (Under Settings > Exemption Certificate Options) you must create an exemption profile for the customer.