Saxton Seeks Administration Support for Capital Gains Legislation

Washington, DC, September 17, 2001 - Representative Jim Saxton (R-NJ), chairman of the Joint Economic Committee, in a September 10 letter, asked President Bush to consider reviewing the tax treatment of capital gains distributions to mutual fund shareholders as part of the Administration's developing economic stimulus plan, which includes capital gains tax rate reductions.

Representative Saxton has introduced legislation that would allow a mutual fund shareholder to defer up to $5,000 of mutual fund capital gains distributions from current taxation, as long as the amounts were automatically reinvested ($10,000 for joint filers).

The Institute has expressed support for legislation to defer capital gains taxes on reinvested capital gains distributions, and has sent a letter of support to Representative Saxton.