Democrats seem to have spared wealthy Americans like billionaire tech mogul Peter Thiel from big tax bills on their vast Roth retirement savings in legislation unveiled this week.

That break is courtesy of new language in a $1.75 trillion social and climate measure around required withdrawals from Roth accounts. The change to an earlier version of the plan protects the withdrawals from tax.

House Democrats proposed legislation Wednesday that would force taxpayers with retirement accounts worth more than $10 million total to withdraw money each year. (A similar proposal in September was stripped from the legislative framework in October, but then added back.)

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The rule aims to curb use of 401(k) plans and individual retirement accounts as tax shelters for the rich. It would ensnare investors like Thiel, a PayPal co-founder, who have so-called mega IRAs.

Thiel, for example, had a $5 billion Roth IRA in 2019, according to a ProPublica report published in June, based on tax-return data. (The IRA was worth less than $2,000 two decades earlier.)

The House’s initial proposal would likely have forced Thiel to nearly empty the account next year, according to tax experts. Due to his age, Thiel, 53, would have owed income tax on any portion of the withdrawal attributable to investment growth — meaning he’d likely owe taxes on nearly $5 billion, tax experts said.

However, Wednesday’s updated proposal would exempt him — and other young investors with vast Roth accounts — from taxes.

“They made [Thiel’s] forced distribution not taxable,” Ed Slott, an accountant and IRA expert based in Rockville Centre, New York, said of lawmakers. “That’s new.”

There are very few people with vast Roth accounts — just 818 taxpayers had Roth accounts worth more than $10 million in 2019, the Joint Committee on Taxation said in July. They hold about $25.7 billion.

Roth IRAs are a type of after-tax savings account.

They carry many benefits: Investments grow tax-free, and withdrawals in retirement aren’t taxable. Investors also aren’t required to withdraw money after age 72 as with other retirement accounts.

Investors like Thiel have been able to use Roth IRAs to amass fortunes, sometimes by buying big stakes in high-growth start-ups and shielding that wealth from tax, according to the ProPublica investigation.

However, there are situations in which the federal government does tax investment growth in a Roth account.

IRA owners only get the tax benefit if they withdraw money after age 59½ and if their account is at least five years old. This is a “qualified distribution” under the federal tax code.

Someone who withdraws funds and doesn’t meet these conditions (meaning the account is too new or the investor too young) would owe tax on their investment earnings.

The House tax proposal, which is complex, generally forces investors to withdraw 100% of Roth savings over $20 million. (There may be additional withdrawals for lesser sums, over $10 million.)

But the initial version in September didn’t exempt investors under age 59½ from income taxes on any investment earnings that are withdrawn. The proposal unveiled Wednesday, however, treats them as a “qualified distribution” exempt from tax.

“It’s a big change,” according to Robert Keebler, an accountant and estate planner based in Green Bay, Wisconsin.

However, the change is fair and practical, Keebler said. Incurring tax on those funds would amount to the government breaking a promise with Roth IRA owners, he said.

Of course, the wealthy would still be forced to withdraw ample sums and determine where to park the funds — perhaps in less tax-friendly havens.

Beyond treating Roth IRA distributions as “qualified,” this week’s House proposal spared Thiel and other taxpayers via another change, according to tax experts.

The initial proposal would have made these new required minimum distribution rules effective in 2022. The updated version would kick in starting in 2029.

By that time, Thiel will be in his 60s — and would be able to take tax-free Roth withdrawals anyway.

Thiel didn’t respond to a request for comment through Palantir, where he serves as chairman of the board of directors.