The modification of novel trifunctional epoxy resins with silicon rubber to reduce stress while maintaining a high glass transition temperature is described. Trifunctional epoxy resins were synthesized from the condensation of 4-hydroxybenzaldehyde, chloroacetaldehyde or crotonaldehyde with phenol, followed by epoxidation with a halohydrin. The structure of the synthesized triphenols was characterized by infra-red, mass, and nuclear magnetic resonance spectrometry. Toughening of trifunctional epoxy resins was achieved by hydrosilation with side chain methyl hydrogen siloxanes. The dynamic viscoelastic properties and morphologies of neat silicon rubber-modified epoxy networks were investigated. The mechanical properties of encapsulants formulated from the synthesized silicone rubber-modified epoxy resins were also studied. The dispersed silicon rubbers effectively reduced the internal stress of cured epoxy resins by reducing Young’s modulus and the coefficient of thermal expansion, while the glass transition temperature was slightly depressed.