In my opinion, by converting the loan in the 2011 tax year, for example, you would be making the contribution during the 2011 tax year, which would have no affect on your taxable income
/expenses or returns for prior years, and which would mean that there would be no losses to carry forward for those prior tax years.
If my argument were wrong, then anyone could change their position on any tax activity at any time, and have it retroactively affect all prior tax years. That is what the IRS and the courts regard as a frivolous
tax argument, and it can lead to some very serious negative consequences.
I think that what you are suggesting could get you into a load of trouble, if you get audited. Of course, you may not get audited -- but, from where I'm sitting, you're taking a big risk.
Hope this helps.
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