Do you have other IRA's that are traditional-deductible IRAs from prior years, including rollover iras? If so, the IRS rules are you assume you are proportionately prorating your roth converstion between your deductible and non deductible, which would cause some taxable income. As an example: If you had $10,000 traditional/deductible or rollover IRAs from prior years, and a $5000 non deductible that you converted to Roth - tax law dictates that you assume 10k/15k of your conversion was from your deductible IRA and 5k/15k was from non deductible, so you would have $10k/15k times $5k = $3667 of taxable income in that example.
As a general rule it is best not to convert traditional non deductibles to Roth if you have other traditional deductible iras, because it will create a tax liability you may not have planned for.
