I 

118TH CONGRESS 

2D SESSION H. R. 9183 

To amend the Internal Revenue Code of 1986 to add qualified semiconductor 

design expenditures to the advanced manufacturing investment credit. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 30, 2024 

Mr. MOORE of Utah (for himself, Ms. DELBENE, Mr. MCCAUL, Ms. MATSUI, 

Mr. MOOLENAAR, Mr. KRISHNAMOORTHI, Ms. TENNEY, Mr. KHANNA, 

and Mr. MORELLE) introduced the following bill; which was referred to 

the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to add qualified semiconductor design expenditures to the advanced 

manufacturing investment credit. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Semiconductor Tech5 nology Advancement and Research Act of 2024’’ or the 

6 ‘‘STAR Act of 2024’’. 


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1 SEC. 2. QUALIFIED SEMICONDUCTOR DESIGN EXPENDI2 TURES ADDED TO ADVANCED MANUFAC3 TURING INVESTMENT CREDIT. 

4 (a) IN GENERAL.—Section 48D of the Internal Rev5 enue Code of 1986 is amended— 

6 (1) in subsection (a), by striking ‘‘an amount 

7 equal to’’ and all that follows through the period and 

8 inserting ‘‘, with respect to an eligible taxpayer, an 

9 amount equal to the sum of— 

10 ‘‘(1) 25 percent of the qualified investment for 

11 such taxable year with respect to any advanced man12 ufacturing facility of such taxpayer, and 

13 ‘‘(2) 25 percent of the qualified semiconductor 

14 design expenditures paid or incurred by such tax15 payer during the taxable year.’’, 

16 (2) by redesignating subsections (c), (d), and 

17 (e) as subsections (e), (f), and (g), respectively, 

18 (3) by inserting after subsection (b) the fol19 lowing new subsections: 

20 ‘‘(c) QUALIFIED SEMICONDUCTOR DESIGN EXPENDI21 TURES.— 

22 ‘‘(1) IN GENERAL.—For purposes of subsection 

23 (a)(2), the term ‘qualified semiconductor design ex24 penditures’ means the sum of the following amounts 

25 which are paid or incurred by the taxpayer during 


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1 the taxable year in carrying on any trade or business 

2 of the taxpayer for— 

3 ‘‘(A) in-house semiconductor design ex4 penses for semiconductor design conducted in 

5 the United States, and 

6 ‘‘(B) contract design expenses for semicon7 ductor design conducted in the United States. 

8 ‘‘(2) IN-HOUSE SEMICONDUCTOR DESIGN EX9 PENSES.— 

10 ‘‘(A) IN GENERAL.—The term ‘in-house 

11 semiconductor design expenses’ means— 

12 ‘‘(i) any wages paid or incurred to an 

13 employee for qualified services performed 

14 by such employee, 

15 ‘‘(ii) any amount paid or incurred for 

16 supplies used in the conduct of qualified 

17 semiconductor design, and 

18 ‘‘(iii) under regulations prescribed by 

19 the Secretary, any amount paid or in20 curred to another person for the right to 

21 use computers in the conduct of qualified 

22 semiconductor design. 

23 Clause (iii) shall not apply to any amount to 

24 the extent that the taxpayer (or any person 

25 with whom the taxpayer must aggregate exVerDate Sep 11 2014 04:17 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H9183.IH H9183

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1 penditures under paragraph (7) receives or ac2 crues any amount from any other person for 

3 the right to use substantially identical personal 

4 property. 

5 ‘‘(B) QUALIFIED SERVICES.—The term 

6 ‘qualified services’ means services consisting 

7 of— 

8 ‘‘(i) engaging in qualified semicon9 ductor design, or 

10 ‘‘(ii) engaging in the direct super11 vision or direct support of design activities 

12 which constitute qualified semiconductor 

13 design. 

14 If substantially all of the services performed by 

15 an individual for the taxpayer during the tax16 able year consists of services meeting the re17 quirements of clause (i) or (ii), the term ‘‘quali18 fied services’’ means all of the services per19 formed by such individual for the taxpayer dur20 ing the taxable year. 

21 ‘‘(C) SUPPLIES.—The term ‘supplies’ has 

22 the meaning given such term in section 

23 41(b)(2)(C). 


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1 ‘‘(D) WAGES.—The term ‘wages’ has the 

2 meaning given such term in section 

3 41(b)(2)(D). 

4 ‘‘(3) CONTRACT DESIGN EXPENSES.— 

5 ‘‘(A) IN GENERAL.—The term ‘contract 

6 design expenses’ means 100 percent of any 

7 amount paid or incurred by the taxpayer to any 

8 person (other than an employee of the tax9 payer) for qualified semiconductor design. 

10 ‘‘(B) PREPAID AMOUNTS.—If any contract 

11 design expenses paid or incurred during any 

12 taxable year are attributable to qualified semi13 conductor research to be conducted after the 

14 close of such taxable year, such amount shall be 

15 treated as paid or incurred during the period 

16 during which the qualified semiconductor design 

17 is conducted. 

18 ‘‘(4) TRADE OR BUSINESS REQUIREMENT DIS19 REGARDED FOR IN-HOUSE DESIGN EXPENSES OF

20 CERTAIN STARTUP VENTURES.—In the case of in21 house semiconductor design expenses, a taxpayer 

22 shall be treated as meeting the trade or business re23 quirement of paragraph (1) if, at the time such in24 house semiconductor design expenses are paid or in25 curred, the principal purpose of the taxpayer in 


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1 making such expenditures is to use the results of the 

2 design in the active conduct of a future trade or 

3 business— 

4 ‘‘(A) of the taxpayer, or 

5 ‘‘(B) of 1 or more persons who with the 

6 taxpayer are treated as single taxpayer under 

7 paragraph (7). 

8 ‘‘(5) QUALIFIED SEMICONDUCTOR DESIGN.— 

9 ‘‘(A) IN GENERAL.—The term ‘qualified 

10 semiconductor design’— 

11 ‘‘(i) means the development (or direc12 tion of the development) of product design, 

13 design specifications, trade secrets, tech14 nology, or other intellectual property for 

15 the purpose of semiconductor manufac16 turing, substantially all of the activities of 

17 which constitute elements of a process of 

18 experimentation for a purpose described in 

19 subparagraph (B)(i), and 

20 ‘‘(ii) does not include any activity de21 scribed in subparagraph (B)(ii). 

22 ‘‘(B) PURPOSES FOR WHICH RESEARCH

23 MAY QUALIFY FOR CREDIT.—For purposes of 

24 subparagraph (A)— 


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1 ‘‘(i) IN GENERAL.—Semiconductor de2 sign shall be treated as conducted for a 

3 purpose described in this paragraph if it 

4 relates to— 

5 ‘‘(I) a new or improved function, 

6 ‘‘(II) performance, or 

7 ‘‘(III) reliability or quality. 

8 ‘‘(ii) CERTAIN PURPOSES NOT QUALI9 FIED.—Semiconductor design shall in no 

10 event be treated as conducted for a pur11 pose described in this paragraph if it is 

12 conducted for purposes of— 

13 ‘‘(I) style, taste, cosmetic, or 

14 other design factors unrelated to a 

15 purpose described in clause (i), 

16 ‘‘(II) design after the commence17 ment of commercial production of the 

18 semiconductor, unless such design is 

19 related to firmware, software, or man20 ufacturing process activities that 

21 would otherwise meet the require22 ments of clause (i), 

23 ‘‘(III) duplication of an existing 

24 semiconductor product (in whole or in 

25 part) from a physical examination of 


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1 the semiconductor itself or from 

2 plans, blueprints, detailed specifica3 tions, or publicly available information 

4 with respect to such semiconductor, or 

5 ‘‘(IV) surveys or studies related 

6 to— 

7 ‘‘(aa) efficiency, 

8 ‘‘(bb) management function 

9 or techniques, 

10 ‘‘(cc) market research, test11 ing, or development, including 

12 advertising and promotions, 

13 ‘‘(dd) routine data collec14 tion, or 

15 ‘‘(ee) routine or ordinary 

16 testing or inspection for quality 

17 control. 

18 ‘‘(6) UNITED STATES.—For purposes of this 

19 subsection, the term ‘United States’ includes the 

20 possessions of the United States. 

21 ‘‘(7) AGGREGATION OF EXPENDITURES.—For 

22 purposes of this subsection, in determining the 

23 amount of qualified semiconductor design expendi24 tures, rules similar to the rules of section 41(f)(1) 

25 shall apply. 


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1 ‘‘(d) COORDINATION WITH CREDIT FOR INCREASING

2 RESEARCH EXPENDITURES.—Any qualified semicon3 ductor design expenditures for which a credit is allowed 

4 under this section shall not be taken into account for pur5 poses of determining the credit allowable under section 41 

6 for such taxable year.’’, and 

7 (4) in subsection (g) (as so redesignated), by 

8 inserting ‘‘or qualified semiconductor design expend9 itures paid or incurred after December 31, 2026’’ 

10 before the period. 

11 (b) CONFORMING AMENDMENT.—Section 56A(c)(9) 

12 of the Internal Revenue Code of 1986 is amended by strik13 ing ‘‘48D(d)’’ and inserting ‘‘48D(f)’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to amounts paid or incurred after 

16 the date of the enactment of this Act. 

Æ 


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