The Big IRA and the recent Government Accountability Office report
In 2012, during the presidential election campaign between Barack Obama and Mitt Romney, the issue was raised about Mitt Romney’s over-sized IRA. At one point the IRA is reported to have had as much as $102,000,000 in it. Yes, you read that correctly.
Mitt Romney’s IRA was worth $102,000,000.
Even compared to his reported $250 million net worth, this is a sizable chunk of capital to have accrued in his IRA given his approximate 40 years of working experience. How did he do it?
The recent Government Accountability Office report
In October 2014, the U.S. Government Accountability Office (GAO) released a report, “Individual Retirement Accounts – IRS could bolster enforcement on multi-million dollar accounts, but more direction from congress is needed”. According to the GAO, they found that there were 314 taxpayer IRAs which had an account balance of over $25,000,000 and 791 taxpayers with balances between $10,000,000 and $25,000,000. That is a total of 1105 people who have been great investors, extremely lucky, or both. Either way, they have found a way to capitalize on the tax benefits of a Traditional IRA or Roth IRA by growing their capital in a tax-deferred or tax-free manner.
While it may not be easy to accumulate over $100 million in your IRA, you can still use the same strategies that Mitt Romney used to accumulate a sizable IRA account balance.