The mutual fund industry is gearing up to deliver the largest tax distributions in six years and the third-largest ever. Funds will pay out an estimated $200 billion in capital gains and income to investors, up from $129 billion last year. According to Lipper estimates, fund investors will pay about $20 billion in taxes this year, up from $15.2 billion in 2005. One reason distributions are up is that it's been a good year in the stock market.
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