I have a 1999 Volvo V70XC that has no power in reverse. All other gears shift fine and work, except the reverse. It makes an audible clunk only when shifting into reverse and moves for a second, but then no power. The AFT fluid level is slightly above min and is a light brown (close to the color of a cardboard box) and smells like burnt paper. No metallic specs in the fluid though. Also there are no check engine codes or any flashing arrows signifying a transmission problem. Kind of a loaded question, but what would you all suspect is the issue, and how should I remedy it?

 

doesn't sound promising, but I'd start by properly setting the fluid level using the cold and warm marks. The light brown color is somewhat odd - Normally new fluid is red and progressive to reddish brown and turns black when components get scorched. I'm wondering if there could be an issue with the transmission cooler mixing coolant into the transmission. If so, you'd need to replace the radiator, flush the transmission and flush the cooling system. Last is try a shifter row - just in case the PNP switch is acting up.

Any sign of coolant loss?
Did you scan for any stored transmission codes?
Do the wheels spin backwards when on a lift or jack stands?