Roth Conversion Value

Question

Is the conversion value I use to complete Form 8606 the value of the statement on the rollover date (say I roll it over today - 3/31/2017) or would it be the value on the year end statement (12/31/2017)? I ask this because the private fund my wife is invested in is doing incredibly well and if it is the date of the conversion, it would make since to do this rollover ASAP rather than wait until end of year when the value could be higher. Thanks

Answer 1

Which line are you talking about? If you are talking about line 8, that is the actual amount converted (the actual amount distributed from Traditional and contributed to Roth).

If it is as you describe, it does make sense to convert early, especially since you have the opportunity to "undo" the conversion via recharacterization any time before the tax return due date if it later turns out that the conversion wasn't to your advantage (though you would then be restricted in converting again for a certain period of time).