A bill introduced in the House of Representatives would exempt from federal taxes up to $3,000 in mutual fund capital gains fund investors must accept even though they have not sold their fund shares. For investors filing joint returns, that exemption would be doubled to $6,000.

The bill, introduced by Representative Jim Saxton (R.-N.J.), vice chairman of the Joint Economic Committee, provides for annual cost-of-living adjustments to be made to the exempted capital gains beginning in 2002.

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