By Judith Barish and Katherine Cohn
When the CHIPS and Science Act was signed into law in August 2022, with the promise of restoring semiconductor production to the US and creating good manufacturing jobs for US workers, the Congressional Budget Office projected that one piece of it – the Advanced Manufacturing Investment Tax Credit – would cost taxpayers $24 billion. Nearly four years later, we estimate the total cost of the tax break is over eight times higher than projected: $205.6 billion. Adding in the cost of CHIPS Act incentive grants, the price tag for each new job created by the federal program is $1,019,660.
Background: A sweet deal
While CHIPS Act direct grants to individual companies received significant media attention, it turns out that a little-known provision of the law will amount to the major windfall for the semiconductor industry and the biggest cost for taxpayers.
Thanks to the Act’s Advanced Manufacturing Investment Tax Credit, also called the 48D tax credit for its section in the Internal Revenue Code, all chip makers are eligible for federal corporate income tax credits they can use or cash out. The 48D tax credit is very generous – after an upgrade in the Big Beautiful Bill Act, it is now worth 35% of what companies spend on new manufacturing capacity. By contrast, the federal tax credit for research and development is 6% of qualified expenses. We conservatively estimate the 48D credit will cost the US Treasury $205.6 billion, more than eight times greater than the $24 billion initially estimated by Congress’s Joint Committee on Taxation.
This bonanza for semiconductor manufacturers is above and beyond the CHIPS Act’s $39 billion Incentives Program, of which about $31.7 billion has been awarded. And it doesn’t include billions more in state and local subsidies to the same corporations.
Because the 48D credits are “as of right,” their costs are not disclosed publicly, and neither are the names of recipients. Semiconductor manufacturers don’t have to apply for them; they just claim the credits on their federal tax returns, which the IRS holds in secret. For every dollar a chip-maker spends on manufacturing facilities or equipment, the IRS will give them 35 cents back the year that property is placed in service. Because construction on projects this size can take a decade or more, chip makers will keep collecting this credit long after any single budget cycle ends. In the absence of public reporting, we have done our best to estimate the lifetime cost of the tax credit.
The National Picture
The Congressional Budget Office originally estimated the Advanced Manufacturing Investment Tax Credit would cost taxpayers $24 billion in foregone revenues. CCU’s own projection puts the real cost at $205.6 billion. That’s an overrun of $181.6 billion – 757% over the original estimate.
Some of that gap results from policy change: the Big Beautiful Bill Act of 2025 raised the credit from 25% to 35% for property placed in service after December 31, 2025. Even if the rate had stayed at 25%, however, our estimate would still put the credit’s cost at roughly $153.9 billion – 541% over the original estimate. Most of the gap between the CBO’s estimate and CCU’s reflects how much bigger this build-out turned out to be than Congress budgeted for and how much longer it will take to finish. CBO’s projection only covered the standard ten-year federal budget window, 2022-2031. Our estimate includes the lifetime cost of the tax credit, and because these megaprojects can take a decade or more to build, many will keep generating credits well past the 2031 cutoff of the CBO’s estimate. The CHIPS Act has triggered over $820 billion in supply chain investments.
Spread across the 232,742 jobs the semiconductor industry says it is creating nationwide, the tax credit comes to $883,444 per job. If you include CHIPS Act grants, US taxpayers are shelling out $1,019,660 per new job created. The cost is higher if you add in state and local subsidies.
Intel
In November 2024, the Biden administration awarded Intel nearly $10.9 billion in federal funding: a mix of CHIPS Act manufacturing incentives across Arizona, New Mexico, Ohio, and Oregon, plus $3 billion through the Secure Enclave program to produce chips for the military. The Advanced Manufacturing tax credit for Intel’s planned investment amounts to an additional $23.3 billion. Add state and local commitments, and the full public commitment to Intel comes to over $36 billion:
- CHIPS Act grant plus Secure Enclave program and DOE funding: $10,866,711,402
- State/local subsidies: $2,533,929,507
- Tax credits: $23,310,000,000
- Total public spending: $36,710,640,909
In exchange, Intel promised the Commerce Department it would create 23,300 US jobs at the cost per job of $1,575,564.
Those are expensive jobs for taxpayers, but the reality turns out to be even worse.
After Intel signed its CHIPS Act contract with the Commerce Department in 2024, the company fell on hard times. Intel posted a $18.756 billion net loss for 2024. Its stock fell roughly 60% during the tenure of CEO Pat Gelsinger, who retired under board pressure in December 2024. His successor, Lip-Bu Tan, has since cut Intel’s global workforce by roughly a quarter and announced more layoffs in July 2026, despite a recent turnaround in revenue and profits.
Instead of enforcing the original commitments, the federal government chose a different approach. In August 2025, it converted the CHIPS grant money still owed to Intel into a 9.9% equity stake in the company. The company was freed from its job creation promises, meaning it will receive more than $35 billion from taxpayers while laying off 8,975 employees and counting.
Micron
Micron’s flagship project in Clay, New York is on track to become the largest semiconductor manufacturing facility in the United States once all four planned fabs are built. It’s also the most expensive of the three companies in this report for taxpayers. Add up federal funding, state and local commitments, and tax credits across Micron’s Idaho, New York, and Virginia projects, and the public commitment comes to over $95 billion:
- CHIPS Act grant: $6,440,000,000
- State/local subsidies: $6,365,250,000
- Tax credits: $82,398,750,000
- Total public spending: $95,204,000,000
In exchange for that money, Micron initially promised to invest $125 billion and create 23,500 jobs. But with the AI boom driving demand for memory chips, Micron is in expansion mode. The company now says it will invest $250 billion in the US, but hasn’t offered a higher estimate of new jobs.
Taxpayers are on the hook for $4,051,234 per job.
TSMC
TSMC is the world’s largest semiconductor foundry, controlling nearly 70% of the global contract chipmaking market, and it plans to invest more in the United States than any other company. After twice expanding its planned investment, TSMC has committed $265 billion to its Arizona campus, the largest foreign direct investment in US history. In return, the company will receive more than $76 billion from taxpayers.
- CHIPS Act grant: $11,565,000,000
- State/local subsidies: $40,000,000
- Tax credits: $64,687,500,000
- Total public spending: $76,292,500,000
It’s not clear how many jobs Arizona workers can expect in exchange for these public dollars. The company initially promised to create 26,000 jobs (6,000 manufacturing + 20,000 construction), but in March 2025 it revised the estimate to 52,000 (12,000 manufacturing + 40,000 construction jobs). Its most recent investment target came without a job commitment estimate. Using the last available figures for job creation, taxpayers will fork out $1,467,163 for each new job.
What do we get in return?
The CHIPS and Science Act is America’s largest experiment in industrial policy. It has clearly been successful at bringing chip production back to the US, but this is small comfort for a public that is increasingly suspicious of the data centers where these chips end up and the AI systems the chips encode. The one measurable benefit we’ve been promised is jobs, after decades in which the US saw manufacturing move overseas and manufacturing employment crater. Like the lawmakers who enacted the CHIPS Act, CHIPS Communities United supports the use of public resources to create good jobs for communities that need them.
But promises and requirements aren’t the same thing. In the case of Intel, the company’s contractual CHIPS Act obligation to create jobs was eliminated entirely when the CHIPS Act grant was converted to equity shares. As for the promises that Micron, TSMC, and other companies made to win CHIPS Act subsidies, it is possible that those contracts have been revised; the contracts with the government have never been made public. Even if the contracts stand, it is up to the US Commerce Department to enforce compliance or invoke clawbacks if companies fail to live up to their legal commitments. We may never know if the companies receiving massive taxpayer handouts will create the jobs we’d all like to see.
Spoiler alert: The new jobs definitely don’t pay a million dollars
When new jobs in semiconductor production are created, boosted by taxpayer funding, a further question is whether they deliver the good, safe, family-sustaining employment communities deserve. While taxpayers subsidize semiconductor manufacturing to the tune of over $1 million per job, the average wage for production workers in the semiconductor industry (the largest group of employees, those without advanced degrees) is just $52,190.
The Advanced Manufacturing Investment Tax Credit is due to expire at the end of 2026, meaning projects that break ground after that date will not be eligible, but industry leaders and lawmakers have called for an extension. It’s high time we evaluate the cost of this taxpayer handout and determine whether we’re getting what we paid for.
Appendix I
Methodology: The Million Dollar Job
Estimating the Tax Break
Calculating the estimate of how much the 48D tax break (also known as the Advanced Manufacturing Investment Tax Credit) will cost across all the semiconductor investments in the United States called for determining three variables: (1) the total investment in the United States eligible for the advanced manufacturing investment tax credit, (2) the percent of each project’s investment eligible for the tax credit, and (3) the tax credit rate to apply across all 116 investment projects.
(1) Total investment in the United States eligible for the Advanced Manufacturing Investment Tax Credit
- The Semiconductor Industry Association (SIA) tracks investment announcements by companies across the semiconductor supply chain, projects that would be eligible for the Advanced Manufacturing Investment Credit (Section 48D), reporting “over 160 projects across 30 states.” SIA provides an estimated dollar amount for 116 of these 160 projects, or 72.5% of all projects. Their data was updated in late August 2026, and we use the combined estimated size of these 116 projects as of the publication date of August 27, 2026, as our best available estimate of total investment eligible for the credit: $820,816,000,000.
(2) Percent of each project’s investment eligible for the tax credit
We reviewed a sample of public statements estimating what share of individual investments would qualify for the credit. Many companies (such as Texas Instruments and Intel) have made no such public statements. Intel’s SEC filings show it claimed the credit in 2023, 2024, and 2025, but don’t break the amount down by site, so we can’t isolate a qualifying percentage for any single Intel facility. In 2023, TSMC estimated it would receive a $7-8 billion tax credit at the 25% rate. This implies that $28-32 billion, or 70 to 80%, of its then-total $40 billion investment would qualify for the tax credit. In 2024, Micron estimated an $11.3 billion tax credit at the 25% rate, implying $45.2 billion, or about 94%, of its then-total $48 billion investment would qualify. A newspaper, not Samsung itself, calculated an $11.2 billion tax credit for Samsung by applying the statutory 25% rate to its full investment total ($45 billion). We don’t treat this as a reliable estimate: it assumes 100% eligibility by construction rather than reflecting any company disclosure. Only two reliable data points exist. We used the lower of the two, and picked TSMC’s 75%, as a conservative estimate applied across all 116 projects.
It should be noted that there are inconsistencies in SIA’s data. In order to create as accurate a weighted average as possible for the tax break rate, investment amounts were based on public reports. However, when applying the weighted tax break rate to the broader 116-project investment total in order to estimate the total tax break estimate, SIA’s figures are used as reported because we do not have the resources to verify every line item in their data.
(3) Tax credit rate to apply across all 116 investment projects
- Two dates determine which credit rate a project qualifies for: when construction began, and when the property was placed in service. The original CHIPS Act set a 25% rate under Section 48D for property placed in service after December 31, 2022, as long as construction began by December 31, 2026. The One Big Beautiful Bill later added a 35% rate for property placed in service after December 31, 2025, keeping the same December 31, 2026 construction deadline.
- Estimating which rate applies to all 116 projects requires an estimate of how much investment falls into each bucket. Fifteen sampled press releases turned up no actual placed-in-service dates: most report only a groundbreaking date or an expected production year, an imperfect proxy at best. We instead sampled the twelve largest projects on the SIA list:
- TSMC’s site in Phoenix, AZ (total investment $265 billion)
- Four Intel sites (OR, NM, OH, and AZ, total investment $99.6 billion)
- Two Texas Instruments sites (UT and TX, total investment $51.9 billion)
- Two Samsung sites (Taylor and Austin, tracked as a single combined investment because the company hasn’t broken out spending by site, total investment $45 billion)
- Three Micron sites (NY, ID and VA, also tracked as a single combined investment for the same reason as Samsung, total investment $250 billion)
- Together, these make up over three-quarters of total investment dollars of all 116 projects listed by SIA. We classified each company’s investment as already in production, which gets the 25% rate, or not yet in production, which gets the 35% rate, based on public reporting. Several facilities appear in both categories because they represent two distinct phases: an original facility already in service, and a newer expansion not yet in service. TSMC’s Phoenix, AZ, site is one example: its first fab in AZ funded by its original $65 billion investment “has been in volume production since late 2024”, which means the $65 billion investment qualifies at the 25% tax rate. However, volume production at the fabs from the subsequently-added $100 billion commitment is “expected to begin in 2027” making it eligible for the 35% tax rate, and the start date for production at the additional facilities to be funded by the second $100 billion commitment has not yet been published as of August 2026, therefore it clearly has not been placed in service before Dec 31, 2025, also making it eligible for the 35% tax rate.
- The sample places $113.7 billion in the 25% category (16% of the sampled total) and $597.8 billion in the 35% category (84%). Together, this sample totals $711.5 billion. Weighting each rate by its dollar share:
- ($113.7B × 25% + $597.8B × 35%) ÷ $711.5B = 33.4%
- This blended rate of 33.4% is applied to the full set of 116 projects with a known investment size to estimate the portfolio-wide tax credit cost.
National Numbers
How much money was spent per job, including CHIPS Act grants?
When calculating how much money per job has been spent by tax payers, we took the amount of money awarded by CHIPS Act grants up until July 2026 ($31,703,407,955), combined it with our estimated cost of the advanced manufacturing investment tax credit ($205,614,408,000), and divided that sum by the total number of jobs promised according to SIA as of August 27, 2026 (232,742):
($31,703,407,955 + $205,614,408,000) / 232,742 = $1,019,660 per job.
Gap between CBO’s and CCU’s Estimates of the Advanced Manufacturing Investment Tax Credit
Several factors suggest the true gap between the CBO’s initial estimate for the Advanced Manufacturing Investment Tax Credit’s cost to taxpayers of $24 billion and CCU’s projection of $205.6 billion could be even larger. Our estimate only covers 116 of the 160 projects SIA has identified as potentially eligible for the credit. The other 44 lack a public dollar figure and are excluded entirely. We also used a conservative estimate of how much of each project’s investment would qualify for the credit: TSMC’s disclosed (average) 75% was the lowest figure in our sample, while Micron disclosed a qualifying share of 94.17%.
Other factors cut in a direction we can’t determine or in the opposite direction. Applying our sampled 33.4% blended tax credit rate (as described under “Estimating the Tax Break” above), drawn from just 12 of the 116 projects, to the full $820,816,000,000 pool (calculated by summing all “Project Size ($)” from the downloaded SIA data as of August 27, 2026) introduces possible error. Not every announced project will necessarily reach production, either. Some may be delayed past the credit’s construction deadline, scaled back, or canceled, which would lower the actual cost below our projection.
Another discrepancy to note: CBO’s projection covered only 2022-2031, while CCU’s estimate reflects the credit’s full lifetime cost. As is standard practice for federal budget scoring, the CBO’s federal cost estimates are conventionally bound to a 10-year window from enactment. The Advanced Manufacturing Investment Tax Credit was assessed under this convention in 2022, covering the years 2022-2031. However, the credit’s actual cost extends well beyond that window because it continues to accrue as companies place property into service, and many projects eligible for the tax credit will still be under construction after 2031. CCU’s estimate reflects that fuller lifetime cost. This difference in time horizon adds years of credit accrual that fall entirely outside CBO’s original window and pushes CCU’s estimate higher relative to CBO’s.
Case Study Total Public Spending Numbers
Each company case study’s total public spending combines three sources: federal grants awarded to support the company’s projects (collected from the 2025 GAO report, Intel’s 8-K and Department of Energy grant award records), state and local spending as compiled by Good Jobs First, and our estimate of the company’s Section 48D tax break.
For Intel, we have chosen to exclude one category of state and local spending that we include for no other company: foregone property tax revenue. Good Jobs First flagged that two New Mexico bonds in its dataset don’t capture the property tax revenue Intel avoided paying because the property is tax-exempt. By Good Jobs First’s calculation, foregone property tax revenue for Sandoval County and Rio Rancho School District totals $36,680,456 since the CHIPS Act (ACFR years 2023, 2024, and 2025).
We have not conducted the same foregone-property-tax research for Micron or TSMC. Including it for Intel alone would apply an inconsistent standard across the case studies, so we leave it out of all three for now. As a result, Intel’s total public spending figure in this report is understated.
Job Numbers
For the national cost-per-job estimate, we use SIA’s “Total Expected Jobs” figure of 232,742. SIA separately reports 71,512 facility jobs and 122,029 construction jobs, but the numbers do not always line up project by project. Rather than trying to reconcile every inconsistency, we use SIA’s stated total, aka “total expected jobs.” This is also the more conservative choice, since by using the larger job count we wind up with a lower cost-per-job estimate.
For the company case studies, we use the best available direct job estimate tied to each company’s US investment. For Intel, that is the 23,300 jobs originally promised under its CHIPS Act projects for each state New Mexico, Oregon, Ohio and Arizona, despite these promises no longer being valid and WARN notice reports of significant layoffs. Intel’s NIST page only offers an approximate job total for the overall project, whereas the individual pages for each state provide clear numbers, so we use the numbers on the individual pages. For Micron, we use Commerce’s overall figure of 23,500 jobs, since its individual project pages do not add up cleanly to that total. For TSMC, we use its most recent detailed estimate of 52,000 jobs (12,000 direct employment jobs aka facility jobs and 40,000 construction jobs). In the case of both Micron and TSMC the companies increased their planned investment without issuing new jobs estimates.
