Should one sell a mutual fund before it distributes capital gains and then buy afterwards?

Depends on when you bot.

If you bot long time ago, you may realize your own capital gain when you sell.

If you bot recently - then yes, it may make sense. That's why it's usually not a good idea to be buying growth funds at the end of the year.

Most mutual funds have "frequent trading" rules or fees to prevent exactly this action. What you would be doing, in effect, is dumping your fair share of the capital gains distribution onto all the other shareholders.

No you should not do this. You gain nothing and it may cost you plenty. Remember when you sell, you are taxed on all your capital gain. If you do this every year, all your "during the year profit" will be taxed as short term (as your holding period is 11 months and 2 weeks), at a higher rate than the long term 15%. If you have held the stock for more than a year, and this is a one time thing, and you believe the government will change the rules in the future and tax long term capital gains again at your regular income rate, and in the future, when you sell you think your income rate will be higher than todays 15% long term rate, then to reduce your future higher taxable rate gains, you could sell. But sell after the distribution as the stock price will go down by the distribution rate and most of this distribution is long term 15% gains. But wait to sell when congress starts talking about raising the rates. Don't sell this year, keep as much as the gains at 15% as you can.