A. Yes, you can use a tactic called "recharacterization" to achieve your goal here.
What Is Roth IRA Conversion Recharacterization?
To protect you against the risk that the account might drop in value shortly after you convert, tax law allows you to "recharacterize" your account. In other words, you get to "unconvert" your IRA from the Roth back to the Deductible or Non-Deductible IRA you originally held. You must do this no later than the extended due date for the tax year in which you converted. After you recharacterize, you can then convert all over again — this time at the new lower market value. And you must wait until the later of (a) the beginning of the year following the year in which the amount was converted or (b) the end of the 30-day period beginning on the day you transfer money from the Roth back to a traditional IRA.
In our next blog post, we will use an example to illustration this powerful tactic and how it could save you lots of tax money.