Tax code permits self-directed IRAs to hold private assets, enabling accounts to grow far beyond annual contribution limits without violating rules.
Mitt Romney’s individual retirement account reached up to $100 million while the annual contribution limit was $6,000, leveraging self-directed IRA rules that remain unchanged. The structure allowed private equity and alternative assets to grow tax-deferred without violating IRS caps on contributions.
Current rules still permit IRAs to hold private company shares, LLC interests, and real estate, with only annual contributions capped at $7,500 in 2026. Growth inside the account faces no legal limits, though prohibited transactions trigger full tax liability and penalties.
The strategy, often called the “Romney IRA loophole,” highlights how self-directed IRAs can accumulate wealth beyond traditional retirement accounts, with no restrictions on asset appreciation once funds are deposited.