Although stock fund investors usually try to avoid investing late in the year in order to avoid paying taxes on a fund's capital gains distribution when they have not yet profited from the fund investment, now may be a good time to ignore that rule and begin investing in funds right away rather than waiting until next year. This is because in the past two years, Standard & Poor's 500 stocks have seen big gains during the fourth quarter. If that happens again this year, this could be the only opportunity for investors to make noticeable gains, due to the current slow stock performance. If a fund decides to make a big distribution later this year, investors can avoid taxes by selling one day prior to the record date, then buying back the day following the record date. However, if they sell at a loss then buy back less than 30 days later, the "wash sale" rules do not allow them to take a loss on their taxes. Other possibilities include using losses to offset distributions, using only tax-deferred accounts, or using only tax-efficient funds, like index funds or exchange-traded funds.