JPMorgan Chase Issues Notes Linked to U.S. Equities Amid Tax Warning

JPMorgan Chase & Co. has announced that it will issue notes linked to U.S. equities or indices, but there may be tax implications for non-U.S. holders.

The bank warns that Section 871(m) of the Code and Treasury regulations could impose a 30% withholding tax on dividend equivalents paid to non-U.S. holders with respect to certain financial instruments linked to U.S. equities or indices.

JPMorgan expects that Section 871(m) will not apply to the notes, but this determination is not binding on the IRS and may be subject to change.

The estimated value of the notes takes into account various factors, including internal funding rates and market inputs, which may prove incorrect in the future.