Roth 401k vs deductible 401k + conversion

[Mike S.]

I was usually using option 1, but I was recently introduced to option 2 and would like to get feedback on its caveats:

Option 1:

- Contribute to the Roth portion of a 401k (lets assume $50k)

- Invest this $50k in a syndication

- Pay regular income tax on this $50k contribution

Option 2:

- Contribute to the deductible portion of the 401k (let's assume again $50k)

- Invest the $50k in a syndication

- Get a third party appraisal of that investment, that has now a fair market value of $30k (due to upfront fee and lack of liquidity)

- Make an in-kind Roth conversion of the investment, valued at $30k

- Pay regular income tax only on the $30k conversion.

Is there a minimum time to wait between step 2 and 4 of the option 2?

What third party appraiser would qualify to do the appraisal?

Any other issue I should pay attention to?