Here is a link to a calculator that may do what you are asking about. http://www.calcxml.com/do/qua04

Now, the first thing I noticed is that you are assuming that you are using the IRA money to convert to the Roth and investing the net $650. You can't do this without incurring a tax on the withdrawal (in your situation, the 35% is considered withdrawn from the traditional IRA during the conversion process), IN ADDITION to paying the tax on the gross amount considered to have been converted ($1000). In other words, in order to avoid an additional tax on the amount withdrawn from the traditional IRA (plus penalties if you are under 59 1/2), you have to pay the tax on the conversion with assets other than those coming out of the Traditional IRA during the rollover process.

Taking into account your loss of income and growth on the other assets is a complicating factor.

I don't know if 8% is a reasonable rate of return in this market environment, and I certainly would not compound it monthly. However, if you did as you are suggesting for the traditional IRA:

PV= -$1000 (i.e. a minus number)

PMT=0 (you are not adding to or subtracting from the account)

i=8/12 (this is 8% compounded monthly)

n=180 (15 years with 12 months/year)

Then you get your FV of the Traditional IRA in 15 years. I suppose you could then apply the 50% rate to the gross amount of the Traditional IRA 15 years hence, assuming that you take all of the money out in year 15, vs. what the after-tax Roth number will be, starting with the lower $650 balance. This would sort of tell you if doing the conversion would make sense over a 15 year time frame.

There is a lot that you leave unsaid (i.e. if you will be taking withdrawals from the account each year in the future, which could complicate this question a lot). My sense is that you are trying to compare what you would have in 15 years on the Traditional vs. Roth accounts, but you are asking how to use the HP, and that is a different question.

I hope that this helps.

Best wishes,

Anita