Definition: Tax-planning funds cater to the investors' need of minimizing tax burden on the returns from investments. They are also called equity-linked tax saving funds or ELSS. These funds are market capitalization agnostic. These are close ended schemes with a lock-in period of 3 years.
Description: These are like typical mutual funds, which help to diversify investments across different varied market capitalization stocks and in addition also help you reduce your tax burden by creating a portfolio which takes the maximum advantage of the tax exemption under Section 80C of the Income Tax Act, having an upper limit of Rs 1,50,000.