Retirement tax questions

I have entered our 1099-Rs in the method you describe, but what I don't understand is why TurboTax treats this 1099-R as a taxable event when it is not. 

 

We did not receive a deduction for this in 2020 so why are be taxed for something that was done with after tax dollars?

 

The only difference between this and the other method of adding a backdoor roth contribution (as one of your previous posts describes) is that instead of the contribution and rollover occurring in the effective year (2020 in this case), the contribution and rollover happened in 2021 for the 2020 tax year.