STAR Act of 2025
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Overview
The Semiconductor Technology Advancement and Research Act of 2025 (STAR Act) modifies the existing advanced manufacturing investment credit to include qualified semiconductor design expenditures. It allows taxpayers to claim a 25% tax credit for in-house and contracted semiconductor design expenses incurred in the United States, provided the design activities meet specific criteria related to innovation and experimentation. The credit is phased out for property beginning construction after 2036 and expenditures after 2036, and it won't be counted towards other research credits.
Key provisions
- Allows a 25% tax credit for in-house semiconductor design expenses.
- Allows a 25% tax credit for contracted semiconductor design expenses.
- Defines ‘qualified semiconductor design expenditures’ as in-house design costs and contracted design costs.
- Specifies criteria for ‘qualified semiconductor design’ related to innovation (new function, performance, reliability).
- Excludes certain design activities like cosmetic design, post-production design, and routine testing.
- Provides rules for aggregating expenditures for determining credit eligibility.
- Phases out the credit for property beginning construction after 2036 and expenditures after 2036.
- Prevents the credit for semiconductor design from being counted towards other research credits.
Who is affected
- Semiconductor manufacturers
- Companies providing semiconductor design services
Bill text
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