How do I create holes in a polygon (cookie cut)?

The official answer on this is that 1.2 does not provide support for creating holes in polygons.   We support polygons with holes for display and calculations, but the feature editor does not support them.

We are, however, hard at work on the next major feature release and this is included in the editor feature set, along with a number of other major changes.   Please stay tuned!

Nice.

I've noticed the KML export feature also fails when working with holes in polygons. If you have a beta with this new functionality, I'd love to try it.

Any update about making holes into a polygon: it is said we can do it in the help document but no where how to ?