IRS Issues Final Rules on Direct Pay for CHIPS Act Credits (1)

The IRS issued final regulations Tuesday for companies that would like to receive a direct payment for a manufacturing tax credit included in the CHIPS Act instead of claiming the credit as a deduction against their tax bills.

The regulations (TD 9989, RIN 1545-BQ75) come after the IRS released proposed regulations in June on the direct pay option, laying out how companies that manufacture both semiconductors and semiconductor-fabrication equipment can elect the payment.

Semiconductor manufacturers welcoming the new tax credit rules also want to nail down key definitions of eligible equipment and payment timelines.

The credits will provide ...