After entering the Form 1099-R reporting the $6,500 distribution from the traditional and indicating that you converted that amount to Roth, click the Continue button on the page that lists the Forms 1099-R that you have entered. When TurboTax asks for the year-end value of your traditional IRAs, enter the amount that was left in your traditional IRAs on December 31. The result will be that a portion of your $6,500 contribution will be taxable and the same amount as is taxable will remain as basis in nondeductible traditional IRA contributions in your traditional IRAs to be applied to future traditional IRA distributons.
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