TL;DR: What You Need to Know
- Residents (183+ days) are taxed on Taiwan-source income at 5% to 40%. Foreign-source income is outside that calculation but counts toward a 20% Income Basic Tax once overseas income reaches NT$1 million.
- There is no US tax treaty. A bill authorizing negotiations passed the House 423-1 in January 2025 and is pending in the Senate.
- With a top rate of 40%, mid and high earners should model the Foreign Tax Credit alongside the FEIE (up to USD 132,900 for 2026).
- Form 1040 is due April 15, with an automatic extension to June 15 for expats abroad. File an FBAR if foreign accounts exceed USD 10,000 at any point in the year. FATCA reporting applies at higher thresholds.
America's Largest Trading Partner Without a Tax Treaty
Taiwan is, by a wide margin, the largest US trading partner with no bilateral income tax treaty, a genuine anomaly given the depth of the economic relationship (driven substantially by the semiconductor industry). That's finally changing: a January 2025 House vote points toward a real agreement, though nothing is signed and the Senate has not acted. In the meantime, Taiwan's ranking as the world's #2 country for expat satisfaction, world-class healthcare, and the distinctive Gold Card visa program continue to draw a growing American population. This guide covers the FEIE vs FTC choice, the pending tax agreement, Gold Card mechanics, and the country's genuine property reciprocity.
Quick Overview: Taiwan and US Tax Obligations
The Basic Conflict: Taiwan taxes residents (183+ days present) on Taiwan-source income at progressive rates from 5% to 40% (foreign-source income is generally outside that calculation but counts toward a 20% Income Basic Tax once it reaches NT$1 million and basic income passes NT$7.5 million), among the higher top brackets in our coverage, comparable to Australia's. Non-residents face a flat 18% on Taiwan-source salary income, with other income taxed at different rates. Because of the high top bracket, mid-to-high earners here should model the Foreign Tax Credit alongside the FEIE, rather than defaulting to the exclusion alone.
Taiwan today: A calendar-year National Taxation Bureau filing system, no US tax treaty (though a bill authorizing negotiations has passed the House), no Totalization Agreement, and the distinctive 4-in-1 Gold Card visa combining residence, open work permit, ARC, and re-entry permit in one document.
United States: File Form 1040 by April 15 (automatic extension to June 15 for expats). The FEIE (Form 2555) shields up to $132,900 of earned income for 2026, and the Foreign Tax Credit (Form 1116) offsets US tax on income above that using actual Taiwan tax paid. FBAR (FinCEN Form 114) applies once combined foreign accounts exceed $10,000, and FATCA (Form 8938) applies above higher thresholds.
