Epoxy resin based encapsulants are widely used in semiconductor packaging applications. Epoxy resin based encapsulants are often subject to crack or delamination during the reliability test due to the thermal stress caused by high modulus nature of epoxy resins. Epoxy functional siloxanes are often added into epoxy resin to reduce the modulus so that the thermal stress can be reduced. Epoxy functional siloxanes, additives for reduced modulus, were synthesized and added into the curable epoxy resins. The modulus and the coefficient of thermal expansion (CTE) were also measured to investigate the thermal stress and to see whether the epoxy functional siloxane adversely affects the CTE or not. As a result, around 26% to 72% of thermal stress reduction was observed with no adverse effect on CTE.