"What's stopping the average citizen from exploiting this tax avoidance strategy?"
Probably that the average citizen doesn't have capital gains.
Probably that the average citizen doesn't have capital gains.
It depends on which kind of retirement account. Might be in Roths and Roths-401Ks which are taxed when the money goes in (treated as regular income), or IRAs and regular 401Ks which are taxed as regular income when the money comes out.