The IRS made significant changes to conversion rules starting in 2010.
In the past high income earners with incomes over $100,000 were not allowed to convert to a Roth IRA. Their incomes also kept them from contributing to a Roth IRA.
Starting in 2010 the income cap for conversions has been removed. Now everyone, including high income earners, can convert to a Roth IRA whenever they want as long as they pay the appropriate taxes.
2010 Special Conversion Tax Rules
The taxes for conversions to a Roth IRA can be spread out over the following two tax years if you convert in 2010. The IRS is allowing individuals to spread out the income tax increase rather than paying it all at once. However, any conversions done after December 31, 2010 will not get this privilege.