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12b-1 fees
Annually charged marketing/distribution fee on mutual fund shares. They are most often used to reimburse the original salesperson (i.e. marketing), though some 12b-1 fees are paid to the custodian (i.e. distribution). 12b-1 fees are named for the section of legislation that provides for them, and typically range from 0.25% to 1.0%. These fees are included in the fund’s expense ratio, rather than charged separately, and have become more common as loads fall out of favor.
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