Go to Other Tax Situations -> Additional Tax Payments -> Underpayment penalties. Click through the pages and verify the entries until you reach the Annualized Income Method page. Click Yes, you want to annualize.
To annualize, you must allocate your various income, deduction and tax payment amounts to each of the tax quarters of the year. The entries will be made as amounts for Q1, Q1+Q2, Q1+Q2+Q3 and full year. It's a rather onerous process to determine the allocations, but the result in your case will be that the conversion amount will only be present in the full-year income entries and your Q4 estimated-tax payment will take care of it. Check the results by examining the Form 2210 and 2210 Penalty Worksheet generated by TurboTax.
You'll likely need to do the same for your state tax return.
