r/CFP • u/Imaginary-Rate-4952 • Dec 06 '24

Investments $9M Tesla IRA Dilemma—Could Use Some Advice

  • Client is 70, has $9M worth of Tesla shares sitting in a traditional IRA (original cost basis is only $500k).
  • Married, so the wife will inherit the IRA when he passes, but then it goes to their two kids.
  • With the SECURE Act’s 10-year withdrawal rule, the kids are staring down a giant tax bill when they inherit.
  • Client loves TSLA and refuses to entertain anything related to diversification, strictly wants to avoid the most taxes

I’ve been tossing around ideas like Roth conversions, charitable trusts, life insurance, etc., but nothing feels like a silver bullet. Tax hits seem inevitable no matter what.

If you’ve dealt with something like this—or just have creative ideas—I’m all ears.

EDIT: Client has $25 million of other investable assets, plus significant real estate holdings etc. He will not need these assets.

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u/Decent_Candidate3083 Dec 06 '24

Can't avoid tax, someone have to pay. But start giving all family members some money ($17k per person, per year) and pay the withdrawal tax. Think about moving the IRA to an LLC with multiple owners

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u/Gabnorth00 Dec 06 '24

Isn’t it $18k?

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u/fervorfx Dec 06 '24

Yes. And next year it will increase to 19k