A QCD is not permitted include basis. Only the amount that would otherwise be taxable if all amounts in all of your traditional IRAs were distributed during the year is permitted to be reported as QCD. TurboTax does not enforce this limitation, so you must do the calculation yourself and enter as QCD (the amount "transferred to charity") only the otherwise taxable amount. (I've previously reported this shortcoming of TurboTax, but there has been no action regarding any changes to improve this.) If the amount of money in your traditional IRAs in excess of your basis is sufficient to cover the entire amount transferred to charity, the entire amount is reportable as QCD and TurboTax prepares Form 8606 correctly by excluding the entire QCD amount from Form 8606 line 7.
Any amount of the distribution transferred to charity in excess of the amount permitted to be reported as a QCD must be reported on Schedule A as a charitable deduction by you separately entering the charitable contribution under Deductions & Credits, the same as if the IRA distribution was paid to you and you subsequently made a contribution to the charity.
