Why does ascites affect breathing?

Diaphragm: Ascites is an accumulation of fluid in the abdominal cavity. The diaphragm, which is the muscle that divides the abdomen from the thoracic cavity( where the lungs are located) , helps in pulling air into the lungs, any accumulation of fluid in the abdomen will increase the intrabdominal pressure thus pushing on the diaphragm upward, preventing it from helping in drawing air into the lungs properly.

Depends on cause: If ascites from heart failure, that combination will frequently ave associated breathing issues. Ascites from an abdominal cause, may push diaphragms up and compromise that element of respiration.