The reason is that you have made your input on Screen 24, which is for direct contribution to Roth, for which your client does not qualify.

Instead, you should make your input on Screen 13.1.  After recording the IRA distribution, you'd scroll down to the section for Form 8606 and enter the following:

• Value of all traditional/SEP/SIMPLE IRAs at 12/31/20 (plus outstanding rollovers) (-1=none); and
• Under Conversion to Roth IRA, Traditional/SEP/SIMPLE IRA distributions converted to Roth IRA