You will want to fully understand the tax reporting burden you will face. 

So if you buy a 5 bedroom house and rent the spare 4 bedrooms = you can still sell tax-free under the 121 (you just pay back depreciation) If you buy a duplex and rent 1/2 and live in 1/2.

Often times you will pay much more in taxes than if you pulled the money out, paid the taxes and penalty and then started investing in real estate.For example, with the financing you mentioned, the IRA must pay taxes on the portion of the profit earned by financing. 

Attractive Tax Environment for InvestorsGermany offers favorable tax policies for property investors.

@Rebecca GonaBigger Pockets is a great place to find a tax accountant that specializes in short-term rentals. 

You have the ability to sell while limiting your capital gains tax because you lived in 2 of the last 5 years. 

If you think ahead, you can minimize recapture with the right tax planning.So what is recapture?

My payment with insurance & taxes is $1425 a month.

Utilized a low down payment loan, maxed seller credit, tax proration and closed on the 1st of the month to maximize my cash and acquire this property What was the outcome?

I am looking to purchase real estate for both investment purpose as well as to offset as much tax liability as possible.