Place bacon pieces in a large Dutch Oven or soup pot over medium heat and cook until bacon is crisp and browned. Remove bacon pieces and set aside, leaving the fat in the pot.

Add butter and chopped onion to the pot and cook over medium heat until onions are tender (3-5 minutes).

Add garlic and cook until fragrant (about 30 seconds).

Sprinkle the flour over the ingredients in the pot and stir until smooth.

Add diced potatoes, chicken broth, milk, heavy cream, salt, pepper, and ancho chili powder to the pot and stir well.

Bring to a boil and cook until potatoes are tender (about 10 minutes).

Reduce heat to simmer and remove approximately half of the soup to a blender and puree until smooth.

Return the pureed soup to the pot and add sour cream and reserved bacon pieces. Stir well.

Allow soup to simmer for 15 minutes before serving.

Top with additional sour cream, bacon, cheddar cheese, or chives.