@streetwolf wrote:
.....since shares in a MF are constantly being sold and bought the Feds decided to tax based on this buying and selling. Is this the case?
Yes, that is the case with many mutual funds; the underlying assets are bought and sold potentially creating gains for the holders of shares in the funds (typically referred to as capital gains distributions, which are long term capital gains).
You should receive a tax reporting statement, such as a 1099-B, from your broker or direct from Vanguard.
