To be quite honest, I will have to go back and check how I did it, because I abandoned the kerf compensation because of the no-reverse in g41,g42 code. I will check it out and get back to you.

Whacko

Ok, this is it! Disregard all I said before in this thread. I got rusty cause I played with the offsets way back. I went through the whole excercise and then everything came back to me, including why I don't use the G40,G41,G42 codes, and it's not just because you cant do reverse or jog in the kerf enabled modes.

To get it to sort of work, you go to the "config" menu. Click on "tool table". A selection box apears. In slot one you can type plasma as the name. The kerf will be the diameter setting. Enter your kerf diameter and save.

Now the kerf is saved in slot 1 of a possible 255 settings. Don't use the G54 command. You use the G41D1 command. The D1 designates the tool number with it's diameter in slot 1 you entered before as I described. So, D1 is TOOL1. D does not mean diameter. I think you cannot use just G41/42, you have to select the tool. Someone who has more experience and watching this thread can correct me on this. But in my setup it won't work unless I specify the tool number. But this is where you will discover that Mach3 don't work kindly for plasma application.
So to cut a square your code could look something like this.

%
G21
G91
G00X10.00Y10.00
G41D1
M07
G01X0.00Y100.00
G01X100.00Y0.00
G01X0.00Y-100.00
G01X-100.00Y0.00
M08
G40
G00X-10.00Y-10.00
M30
%

You might get an error about concave cut in cutter radius compensation or something like that. Then you could do this:
%
G21
G91
G41D1
G00X10.00Y10.00
M07
G01X0.00Y100.00
G01X100.00Y0.00
G01X0.00Y-100.00
G01X-100.00Y0.00
M08
G40
G00X-10.00Y-10.00
M30
%

You won't get the error, but the kerf compensation ramps up to full diameter at second corner of the square. No good, cause you'll be cutting into the job.

That's one of the few reason's I gave up on it, and I did post something about the G41/42 some time ago, but Brian replied that the way Mach3 is written, its a big problem to change the code and I have to compensate for the kerf in the CAD software. I don't use Lazycam, but I did read something about this in an earlier thread.

Well, Sorry for leading you on a goosechase.

Whacko

I did exactly what you suggest above.
But now the program stops at the G41D1 command,
by showing white the next command on the screen,
and with no error generated. Just stops there waitting.
Should i make any configurations? (I tried a few things in the general config menu, but nothing...)
  Please help!

If the program stops there it is most propably an error. That is one of the reasons I don't use the G41 etc codes. I had problems with it, and then worked around it. Maybe Brian or someone else can step in here and give you advice.

Whacko