The first step to investing tax-deferred or tax-exempt in real estate is to set up a self-directed IRA with one of the IRA administrators or custodian such as PENSCO Trust Company. It is a simple matter of a one page application and a small check to establish the account. If you already have a traditional or Roth IRA account with a traditional administrator (a bank, stockbroker or insurance company) you will need a transfer form which will move whatever assets your want from your existing IRA to a single new self-directed account. One very popular way to fund and IRA with a significant amount of money is to roll over your 401 (k) plan. When terminated from employment, most programs give some options such as taking your fund in cash and have 20% withheld for taxes, leave the funds in the plan although the time frame may be limited, you can roll the funds into an IRA, an option which is both tax and penalty free or you can roll your existing 401 (k) into your new employer’s 401 (k). In most cases, a rollover into an IRA is the best option if you want to invest in real estate.