(6) This transfer tax would be on the sale and purchase of financial instruments such as stock, options, and futures. A quarter percent (0.25 percent) tax on financial transactions could raise approximately $150 billion a year.

With Rydex, ProFunds and Direxion you’re referring to ETFs not mutual funds. These trade just as a regular stock would and would be taxed accordingly I’m sure. As for mutual funds the higher costs will be passed on. That’s the ignorance of this bill.. it says it can be cited as “Let Wall St pay for the bail outs” but Wall St includes everyone who owns stock. Everyone will get hit on this.. it’s just another way for government to have more control over our lives.

I have two questions regarding the proposed “Trader-Tax” HR 1068, which I cannot seem to find answers to.

My questions specifically pertain to how this proposed tax might apply to an individual who trades open-ended mutual funds:

1. “Would an individual who daily trades open-ended mutual funds (such as Rydex, Profunds, or Direxion — shares priced at 4pm daily) be subjected to this proposed tax? And if so, what minimum holding period would be required to avoid this proposed tax.”

2. “Would trading open-ended mutual funds in a tax deferred account (IRA, 401k, or Variable Annuity) be subjected to, or exempt from, the proposed trader tax? (i.e. funds cannot be withdrawn from such tax-deferred accounts until age 59 1/2).”

Also, in general, I would appreciate your opinion on whether this proposed Trader-Tax HR 1068 legislation is likely to pass.

Thanks very much. Jim