diff --git a/homeassistant/components/kegtron/config_flow.py b/homeassistant/components/kegtron/config_flow.py
index 8dfb28f0caa..396692491dc 100644
--- a/homeassistant/components/kegtron/config_flow.py
+++ b/homeassistant/components/kegtron/config_flow.py
@@ -72,7 +72,7 @@ class KegtronConfigFlow(ConfigFlow, domain=DOMAIN):
                 title=self._discovered_devices[address], data={}
             )
 
-        current_addresses = self._async_current_ids()
+        current_addresses = self._async_current_ids(include_ignore=False)
         for discovery_info in async_discovered_service_info(self.hass, False):
             address = discovery_info.address
             if address in current_addresses or address in self._discovered_devices:
diff --git a/tests/components/kegtron/test_config_flow.py b/tests/components/kegtron/test_config_flow.py
index fe5cc0e5e5e..0303db988d3 100644
--- a/tests/components/kegtron/test_config_flow.py
+++ b/tests/components/kegtron/test_config_flow.py
@@ -4,6 +4,7 @@ from unittest.mock import patch
 
 from homeassistant import config_entries
 from homeassistant.components.kegtron.const import DOMAIN
+from homeassistant.config_entries import SOURCE_IGNORE
 from homeassistant.core import HomeAssistant
 from homeassistant.data_entry_flow import FlowResultType
 
@@ -199,3 +200,38 @@ async def test_async_step_user_takes_precedence_over_discovery(
 
     # Verify the original one was aborted
     assert not hass.config_entries.flow.async_progress(DOMAIN)
+
+
+async def test_user_setup_replaces_ignored_device(hass: HomeAssistant) -> None:
+    """Test the user initiated form can replace an ignored device."""
+    entry = MockConfigEntry(
+        domain=DOMAIN,
+        unique_id="D0:CF:5E:5C:9B:75",
+        source=SOURCE_IGNORE,
+        data={},
+    )
+    entry.add_to_hass(hass)
+
+    with patch(
+        "homeassistant.components.kegtron.config_flow.async_discovered_service_info",
+        return_value=[KEGTRON_KT100_SERVICE_INFO],
+    ):
+        result = await hass.config_entries.flow.async_init(
+            DOMAIN,
+            context={"source": config_entries.SOURCE_USER},
+        )
+    assert result["type"] is FlowResultType.FORM
+    assert result["step_id"] == "user"
+
+    # Verify the ignored device is in the dropdown
+    assert "D0:CF:5E:5C:9B:75" in result["data_schema"].schema["address"].container
+
+    with patch("homeassistant.components.kegtron.async_setup_entry", return_value=True):
+        result2 = await hass.config_entries.flow.async_configure(
+            result["flow_id"],
+            user_input={"address": "D0:CF:5E:5C:9B:75"},
+        )
+    assert result2["type"] is FlowResultType.CREATE_ENTRY
+    assert result2["title"] == "Kegtron KT-100 9B75"
+    assert result2["data"] == {}
+    assert result2["result"].unique_id == "D0:CF:5E:5C:9B:75"