Bloomberg Law Quotes Brandon Morris on CHIPS Act Tax Credit Rules
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For its article “CHIPS Direct Pay Rules Offer New Opportunities for Partnerships,” Bloomberg Law quoted Akin tax partner Brandon Morris. The article discusses the Internal Revenue Service and Treasury Department’s proposed rules on a tax credit included in the CHIPS and Science Act that are favorable for partnerships and S corporations interested in initiating chip manufacturing projects.
The article notes that Section 469 of the Tax Code disallows partners with passive investments from claiming credits and that the new rules avoid this limitation by paying directly the partnership or S corporation rather than its partners or shareholders.
Brandon said that this distinction will open up investment opportunities beyond large multinationals and thereby encourage private equity and other similar funds to invest in the semiconductor space.
He added, “I think there also is room in here where you might see joint ventures structured as a partnership between multiple industry players coming together to do some sort of development.”
