If you own a Roth IRA, you own the same account type that Max Levchin, the PayPal co-founder and then-chairman of Yelp’s board, grew to roughly $95 million, entirely tax-free. Gains and qualified withdrawals are tax-free forever. The withdrawal rules that let him keep every dollar are the same ones printed on your account paperwork. What differs is how the money got inside.
How $95 Million Landed Inside a Retirement Account
Roth IRA annual contribution limits are, and always have been, a few thousand dollars. Levchin did not contribute his way to nine figures. According to two 2012 Forbes pieces, “How A Serial Entrepreneur Built A $95 Million Tax Free Roth IRA” and “Social Media Tax Dodge”, he used a self-directed Roth IRA to buy founder and pre-IPO Yelp shares inside the account at a nominal valuation, then held them while the company grew and went public.
The math that matters is appreciation, not deposits. In 2010, Levchin sold 3.1 million Yelp shares out of the account and netted about $10.1 million, nearly all of it profit, completely tax-free. By the time Forbes reported the story in 2012, he still held 3.9 million additional Yelp shares in the same Roth IRA, worth roughly $95 million with Yelp trading near $22 a share. The custodian was Pensco Trust Co., the same firm Peter Thiel used for his PayPal shares.
The Legal Gray Area
Tax rules bar an IRA from investing in a business the account owner controls. Buying non-controlling closely held or pre-IPO stock through a self-directed IRA is generally permissible, provided the IRA owner does not retain voting control. Experts describe this as a gray area, with little IRS or court guidance. The structure remains contested territory, and nothing about Levchin’s or Thiel’s use of the structure has been found unlawful.
The Bigger Precedent
Levchin’s story is the smaller cousin of Peter Thiel’s. Per ProPublica’s 2021 investigation “Lord of the Roths”, Thiel opened a Roth IRA in early 1999 with less than $2,000, the annual contribution limit at the time and used it to buy 1.7 million founder shares of PayPal at $0.001 a share, a tenth of a penny, for a total cost of about $1,700. The account was worth $3.8 million by the end of 2000, $28.5 million after eBay’s 2002 acquisition of PayPal, $870 million by 2008, and roughly $5 billion by 2019, built with early positions in Facebook, Palantir, and other companies inside the same Roth. We covered that story in detail on July 22, 2026.
Tax law professor Victor Fleischer called the underlying valuation practices “a huge scandal. How greedy can you get?” and Senator Ron Wyden said the strategy rested on “sweetheart, inside deals,” adding that retirement tax incentives “are designed to help people build a nest egg, not a golden egg.”
Why Congress Is Moving Right Now
On July 22, 2026, Senators Ron Wyden and Richard Neal introduced legislation to crack down on “mega” retirement accounts, a bill was introduced that would require minimum distributions from retirement accounts exceeding $10 million in balance, and bar further contributions to traditional or Roth IRAs once an individual’s combined IRA and defined-contribution-plan balances exceed $10 million. Data released with the bill: 208 individuals hold a combined $85.1 billion in these mega accounts, averaging $409 million each, and more than 32,000 individuals hold over $10 million each, averaging $17 million per account. Sponsors say the bill targets ultra-wealthy account holders and would not affect middle-class savers. It is a proposal, not enacted law, with uncertain odds of passage.
What Actually Applies to Your Roth IRA
The tax-free growth and tax-free qualified-withdrawal rules that turned Levchin’s pre-IPO Yelp position into a nine-figure balance apply identically to your account. Any Roth IRA holder gets the same tax treatment on gains and qualified distributions. What separates the everyday version from the $95 million or $5 billion versions is scale and access, not the rule. Almost nobody can buy founder shares of the next PayPal or Yelp inside a self-directed Roth at fractions of a penny. Almost everyone can hold long-duration equity growth inside a Roth and never pay tax on it again (the quiet years between a last paycheck and the first RMD are also when Roth conversions get cheapest, something we walked through in a free Roth guide).
Levchin, for context, resigned from Yelp’s board in July 2015 and is currently cofounder and CEO of Affirm, with a net worth of $2.2 billion, per Forbes as of Aug. 8, 2026. Whether Congress closes the specific door he and Thiel walked through remains open. For the roughly 32,000 accounts already over the proposed threshold, the Wyden-Neal bill would reshape the endgame. For your Roth, the rulebook that made those balances possible is still in effect.
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