Our previous GWAS using samples from the NSABP P-1 and P-2 selective estrogen receptor modulator (SERM) breast cancer prevention trials identified SNPs in ZNF423 and near CTSO that were associated with breast cancer risk during SERM chemoprevention. We have now performed Next Generation DNA sequencing to identify additional SNPs that might contribute to breast cancer risk and to extend our observation that SNPs located hundreds of bp from estrogen response elements (EREs) can alter estrogen receptor alpha (ERα) binding in a SERM-dependent fashion. Our study utilized a nested case-control cohort selected from patients enrolled in the original GWAS, with 199 cases who developed breast cancer during SERM therapy and 201 matched controls who did not. We resequenced approximately 500 kb across both ZNF423 and CTSO, followed by functional genomic studies. We identified 4079 SNPs across ZNF423 and 3876 across CTSO, with 9 SNPs in ZNF423 and 12 in CTSO with p < 1E-02 that were within 500 bp of an ERE motif. The rs746157 (p = 8.44E-04) and rs12918288 SNPs (p = 3.43E-03) in intron 5 of ZNF423, were in linkage equilibrium and were associated with alterations in ER-binding to an ERE motif distant from these SNPs. We also studied all nonsynonymous SNPs in both genes and observed that one nsSNP in ZNF423 displayed decreased protein expression. In conclusion, we identified additional functional SNPs in ZNF423 that were associated with SNP and SERM-dependent alternations in ER binding and transcriptional regulation for an ERE at a distance from the SNPs, thus providing novel insight into mechanisms of SERM effect.