If the nondeductible traditional IRA contribution was made in 2019, it indeed counts because the calculations treat all transactions as if they occurred on December 31, 2019. If the contribution for 2019 was instead made in 2020, as seems to be the case for jaiswaldeepak, TurboTax might use Worksheet 1-1 to figure the taxable amount instead of lines 6 through 12 of Form 8606 because you made distributions in and nondeductible contributions for the same tax year, indicated by asterisks on lines 13 and 15 of Form 8606. When using Worksheet 1-1, the contribution for 2019 made in 2020 is treated as if the contribution was made in 2019.
