Get your taxes done using TurboTax

TurboTax is correct - the distribution is added back to determine the correct percentage.

Again being a RMD is irrelevant.    Nothing about a RMD goes on a tax return at all.   All IRA distributions are the same, RMD or not.

Taking simple figures and assuming no gains or losses.  Assume that you have a IRA valued at $100,000 with a $10,000 basis and you take a $10,000 distribution in 2019.   Since you are taking 10% of the total value then 10% of the basis (or $1,000) should apply to the distribution so the taxable amount should b e $9,000 leaving $9,000 of basis in the account.

To calculate that the IRS (and TurboTax), on the 8606 form, adds the year end value ($90,000) plus the $10,000 distribution and divides by the distribution.  (($90,000 +$10,000) / $10,000) = .1 or 10%.   The $10,000 basis is then multiplied by the .1 to get $1,000 - the non-taxable amount.

By doing it this way any gains or losses that affect the years end value are accounted for since it would be slightly more or less than an exact 10%.  Unless the distribution is added back in then the ratio of the distribution to the whole cannot be calculated.

See the 8606 for the calculations.