It is estimating it based on the information that is available so far. The refund estimator tool is always based on the entries at hand and changes throughout the entry process.
The estimate TurboTax gives will include your estimated tax or refund on all of the income entered into the program except for income on any taxable distribution from an IRA with a basis that would be calculated on Form 8606.
If there is a tax calculated on Form 8606 after the form is added, that tax will be added to your balance due, or subtracted from your refund.