JPMORGAN CHASE & CO. - Irish Stock Exchange

THE SUMMARY OF U.S. FEDERAL INCOME TAX CONSEQUENCES SET OUT BELOW IS FOR
GENERAL INFORMATION ONLY. PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR TAX
ADVISERS AS TO THE PARTICULAR TAX CONSEQUENCES TO THEM OF OWNING THE NOTES,
THE APPLICABILITY AND EFFECT OF STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND
POSSIBLE CHANGES IN TAX LAW.
U.S. Federal Income Tax Characterisation of the Notes
The U.S. federal income tax characterisation of Notes that can be issued under the Programme may be uncertain and
may vary. Under the relevant authorities, the determination of whether an instrument is properly characterised as debt is
made on the basis of all the facts and circumstances. The courts and the United States Internal Revenue Service (the
"IRS") have identified a number of factors as relevant in characterising an instrument as debt. However, these
authorities have held that the presence or absence of any one factor is not controlling. Typically, the courts and the IRS
weigh the various factors to determine whether, on balance, the debt features of an instrument predominate.
Depending on the terms of a particular Series or Tranche of Notes, such Notes may not be characterised as debt for U.S.
federal income tax purposes despite the form of the Notes as debt instruments. For example, Notes of a Series or
Tranche may be more properly characterised as notional principal contracts, collateralised put options, prepaid forward
contracts, or some other type of financial instrument. Additional alternative characterisations may also be possible.
Further possible characterisations, if applicable, may be discussed in the relevant Final Terms or any Prospectus or
series prospectus.
Recently, the IRS issued a Notice requesting comments from the public with respect to issues that arise in connection
with prepaid forward contracts and similar derivatives. Among other things, the Notice states the IRS is considering
whether parties to such transactions should be required to accrue income/expense over the term of such instruments and
that consideration is also being given to the source of such income. A bill was also introduced in Congress to require
holders of prepaid derivative contracts acquired after the enactment of the Bill to accrue interest currently over the term
of such instrument notwithstanding that the instrument does not bear interest and is not treated as debt for U.S. federal
income tax purposes. It is not possible to predict what, if any, legislative or regulatory action will result from the
proposals above, but it is possible that any such action could materially alter the tax consequences of Notes discussed
below.
No rulings will be sought from the IRS regarding the characterisation of any of the Notes issued hereunder for U.S.
federal income tax purposes. Each holder should consult its own tax adviser about the proper characterisation of the
Notes for U.S. federal income tax purposes and consequences to such holder of acquiring, owning or disposing of the
Notes.
Part 1
U.S. Holders
Bearer Notes are not being offered to U.S. Holders. A U.S. Holder who owns a Bearer Note may be subject to
limitations under United States income tax laws, including the limitations provided in sections 165(j) and 1287(a) of the
United States Internal Revenue Code.
This summary deals only with purchasers of Registered Notes that are U.S. Holders and that will hold the Registered
Notes as capital assets. The discussion does not cover all aspects of U.S. federal income taxation that may be relevant
to, or the actual tax effect that any of the matters described herein will have on, the acquisition, ownership or disposition
of Registered Notes by particular investors, and does not address state, local, foreign or other tax laws. In particular,
this summary does not discuss all of the tax considerations that may be relevant to certain types of investors subject to
special treatment under the U.S. federal income tax laws (such as financial institutions, insurance companies, investors
liable for the alternative minimum tax, individual retirement accounts and other tax-deferred accounts, tax-exempt
74