The Bad News -- And the Good News -- for Your Finances --- Higher Capital Gains Mean Hefty Tax Bills For Fund Investors
Corrections & Amplifications</br></br>FIDELITY INVESTMENTS' Contrafund estimates it will declare a capital-gains distribution equal to 9% of the portfolio's net-asset value on Dec. 29. Friday's Fund Track included Contrafund in a group of funds expected to have a distribution in the 20% range. (WSJ Dec. 18, 2000)</br></br>Ouch!</br></br>It is bad enough that lots of stock funds have negative returns this year. But many of those money-losing funds are about to sock shareholders with a big tax bill, too.</br></br>Expect the worst of this one-two punch to hit investors in the coming two weeks. That is when perhaps as many as half of all funds finally make the capital-gains distributions required by the end of the calendar year, just as shareholders will see what year-end investment returns from their fund holdings will be.