The general guidelines for participating in the JPMorgan Chase Spending Accounts are described in this section. ADP is the claims administrator for the Health Care and Child/Elder Care Spending Accounts. WageWorks is the claims administrator for the Transportation Spending Accounts.

Your participation in the JPMorgan Chase Spending Accounts is optional. In general, you are eligible to participate if you are:

Please Note: An individual classified or employed in a work status other than as a common law salaried employee by his/her employer, such as an:

is not eligible to participate in the accounts regardless of whether an administrative or judicial proceeding subsequently determines this individual to have instead been a common law salaried employee.

Your semimonthly cost of participation depends on the annual amount you elect to contribute to the Health Care Spending Account, Child/Elder Care Spending Account, and/or the monthly amount you elect to contribute to the Transportation Spending Accounts. Contributions to the Health Care Spending Account and the Child/Elder Care Spending Accounts are made on a before-tax basis. Contributions to the Transportation Spending Accounts can be made on a before-tax and after-tax basis.

In addition, IRS rules state that you cannot contribute more than your salary or your spouse's monthly salary, whichever is lower. If your spouse is a full-time student or is incapable of self-care, his or her monthly income is assumed to be $250 in 2008 if you have one eligible dependent or $500 in 2008 if you have two or more eligible dependents. Consequently, an employee with one child that requires care while a spouse attends school full-time for nine months of the year, would be limited to annual contributions of $2,250.

Participation in the Spending Accounts is optional.

You generally have until April 30 of the year following the plan year (January 1 - December 31) to submit eligible claims for reimbursement from the Health Care Spending Account incurred during the plan year and during the two-and-a-half-month extension (January through March 15 of the following year). For the Child/Elder Care Spending Account, you generally have until April 30 of the following year to submit eligible claims for reimbursement incurred during the plan year (January 1 - December 31). However, because you contribute to the Health Care and Child/Elder Care Spending Accounts with before-tax dollars, there are specific guidelines about what happens to any remaining balances after these periods.

The Transportation Spending Accounts, under section 132 of Internal Revenue regulations, allow qualified transportation expenses to be excluded from an employee's gross income. Under these regulations, before-tax contributions are non-refundable to the employee under any circumstance, including termination of employment, retirement, or death.

Under the "Pay Me Back" option, you have 180 days following the end of the benefit month to file claims for reimbursement. After the claims filing deadline, the unclaimed balance will be applied toward future payroll contributions. Please see "The Transportation Spending Accounts" for more information.

Under current U.S. tax law, if you still have a balance credited to either the Health Care Spending Account or Child/Elder Care Spending Account after submitting all claims incurred during the eligible period, that balance will be forfeited. It's very important that you plan carefully before you decide how much to contribute to the Health Care Spending Account and/or Child/Elder Care Spending Account, and that you file your claims by the claims filing deadline.

For example, if you contribute $500 to the Health Care Spending Account, and your claims* are just $450, then you would forfeit the $50 remaining in your Health Care Spending Account.

Your before-tax contributions to your spending accounts do not affect your other pay-related benefits at JPMorgan Chase. Your benefits under the 401(k) Savings Plan, Retirement Plan, Life and Accident Insurance Plans, Disability Leave Policy, and Long-Term Disability Plan will continue to be based on your full, unreduced benefits pay.

The Health Care Spending Account has a card feature that lets you electronically access your account to pay for eligible health care expenses that you incur at locations where the card is accepted. The card can be used at the point of sale (for example, when you're filling a prescription at qualified health care providers who offer eligible services and products; or at merchants who offer eligible over-the-counter items and comply with IRS approval system requirements.) Once ADP receives the electronic debit, the expenses are verified, the appropriate service provider is paid, and your account is adjusted accordingly. There is no fee for the use of the card. If your provider does not accept the card, you will need to submit a paper claim to ADP for reimbursement.

You will receive one card per family for the Health Care Spending Account. You may request additional spending account cards from ADP. To obtain additional cards for your eligible covered dependents, complete the Dependent Card Form from ADP, which can be accessed through the Health Care Spending Account Web Center via My Rewards @ Work, indicate the name of the dependent who will use the card, and fax to ADP at 1-678-893-5571.

You cannot use your Health Care Spending Account debit card for child/elder care expenses.

The IRS requires proof of qualified purchases made with a Health Care Spending Account debit card. It is recommended that you keep your receipts for three years. You will have the convenience of using your Health Care Spending Account debit card at doctors' offices, dental offices, hospitals, health care clinics and pharmacies designated as health care-related merchants or at retail outlets that can provide product-specific details on receipts to prove the purchase or service is valid for the spending account debit card purchase. However, ADP may request that you submit your receipts after your debit card use in order to substantiate that the expenditure paid with the debit card was a properly reimbursable expenditure. If you have expenses that are incurred through the Prescription Drug Plan and administered by Caremark under the POS High and Low Options, the EPO Option, or the Traditional Indemnity Option, generally, substantiation will not be necessary since this information is forwarded directly to ADP by Caremark. If you are required to provide proof of a qualified purchase, you will receive a request for substantiation from ADP, the claims administrator. Failure to provide the required substantiation will result in the temporary deactivation of your Health Care Spending Account debit card, and you will be required to repay the amount of the unsubstantiated/ineligible expense.

If you enroll in the Health Care Spending Account and participate in one or more of the following plans, you may choose either the automatic claim rollover feature or the Health Care Spending Account debit card at the time you enroll:

Please Note: Your election can only be changed during the annual benefits enrollment period. If you do not indicate a preference, you will be assigned the Health Care Spending Account card reimbursement option.

With the convenient automatic claim rollover feature, most eligible expenses you incur will be automatically submitted to your Health Care Spending Account for reimbursement after payment from your Medical/Dental Plan. You will initially pay for eligible expenses out-of-pocket, but you won't have to submit additional Health Care Spending Account claim forms for those expenses. You will still be required to submit paper claims for any eligible expenses incurred under plans that do not accept the automatic claims rollover feature (such as the Vision Plan, an HMO or EPO Medical Plan Option, or a spouse's plan) and for over-the-counter health care expenses.

Each year, you will receive annual statements indicating your current Health Care and/or Child/Elder Care Spending Account(s) balance(s) and listing all the amounts paid to you related to that plan year.

Information about your Health Care and Child/Elder Care Spending Accounts is also available online from the Health Care and/or Child/Elder Care Spending Accounts Web Center via My Rewards @ Work. You can also contact the Benefits Call Center.

Information about your Transportation Spending Accounts is available online from the Transportation Spending Accounts Web Center via My Rewards @ Work. You can also contact the Transportation Spending Accounts Call Center.

The Health Care Spending Account and/or Child/Elder Care Spending Account elections you make during the annual benefits enrollment period will stay in effect through the following plan year (or the current plan year if you enroll during the year as a newly eligible employee). However, you may be permitted to change your elections before the next annual benefits enrollment period if you have a qualified change in status. Please Note: Any changes you make during the year must be consistent with your qualified change in status.

If you have a qualified change in status and want to change your Health Care Spending Account and/or Child/Elder Care Spending Account contributions, please see the Benefits Status Change Guide available on Company Home > HR & Personal > Pay & Benefits > Library, which includes details on how to make changes. This Guide is also available on request through the Benefits Call Center. You need to contact the Benefits Call Center or make your changes through the Benefits Web Center via My Rewards @ Work within 31 days of the qualifying event for benefits to be effective the date of the event. If you miss the 31-day deadline, coverage for certain benefits will be effective as of the date you contact the Benefits Call Center. Otherwise, you will not be able to make the change in contributions until the following annual benefits enrollment period.

Please Note: Documentation of eligibility isn't always required when you enroll, but may be requested at any time by JPMorgan Chase or the claims administrator. Your changes will take effect as of the day of the qualifying event. Eligible expenses are those incurred on or after the effective date of the qualifying event. For example, if you get married on April 15 and increase your Health Care Spending Account from $300 to $3,000, you will only be allowed to claim $300 in expenses incurred from January 1 through April 14.

If you have questions during the year about qualifying events and what the allowed benefits changes are, please visit the Benefits Web Center via My Rewards @ Work, or contact the Benefits Call Center and speak with a Service Representative.

Qualified changes in status for eligible dependents under the Spending Accounts are listed in the following table.

Your contributions to the Spending Accounts end if your work status changes and you are then scheduled to work fewer than 20 hours per week. In this case, you may continue to claim reimbursements from your account balances for any eligible expenses that were incurred before the date of your work status change. In addition, you may be able to continue to make contributions to the Health Care Spending Account on an after-tax basis under COBRA. If your work status changes and you are then scheduled to work more than 20 hours per week, please see "How to Enroll" for information on when you can newly enroll to participate.

The following example shows how paying for eligible expenses using before-tax dollars can actually increase your after-tax income and save you money.

Let's assume your annual income is $40,000, you're married, and you contribute $1,000 to your Health Care or Child/Elder Care Spending Account.