A. What causes backfiring?

and B. Why is my ATV backfiring?

Thanks.

 

When the air/fuel goes lean for a number of reasons such as getting water in the gas etc.

If it backfires when you let off the throttle then this is why,

1) When the throttle valve is in the idle position, fuel does not flow out of the main system (needle, needle jet, main jet). Fuel is only delivered to the engine by the pilot (idle) system.
2) The combined effect of the closed throttle and elevated engine rpm is to create a fairly strong vacuum in the intake manifold. This vacuum, in turn, causes a high air flow rate through the small gap formed by the throttle valve and carburetor throat.
3) Under these conditions the pilot (idle) system cannot deliver enough fuel to create a normal, combustible air/fuel ratio. The mixture becomes too lean to burn reliably in the combustion chamber. It gets sent into the exhaust system unburned and collects there.
4) When the odd firing of the lean mixture does occur, it is sent, still burning, into the exhaust system where it sometimes ignites the raw mixture that has collected ---- the exhaust then pops or backfires.

 

it is backfiring when i let off the throttle. is it bad for the machine and needs to be fixed or is it normal? thanks.

 

Yes it is bad for the machine.. Popping is ok and possibly a rare backfire.
You probably need only to make the pilot jet setting a little more rich.