The nontaxable amount of your Roth conversion is in the same proportion as your basis is to the year-end balance in your traditional IRAs plus the amount distributed or converted. This is calculated on Form 8606 where the year-end value appears on line 6 (or on TurboTax's version of Worksheet 1-1 of IRS Pub 590-B if that worksheet must be used). The rest of your basis stays with your traditional IRAs and appears on Form 8606 line 14.
Because some portion of the Roth conversion is nontaxable, less than the full gross amount of the conversion is taxable.
