A bill to amend the Internal Revenue Code of 1986 to provide special rules for the taxation of certain residents of Taiwan with income from sources within the United States.
Key claim: S199 proposes special IRS rules to govern how certain Taiwan residents are taxed on U.S.-source income, addressing a longstanding gap in the absence of a formal U.S.-Taiwan tax treaty.
Abstract
(S199 · 119th Congress) Latest action (2025-01-23): Read twice and referred to the Committee on Finance.
Why this matters
The absence of a formal U.S.-Taiwan tax treaty creates a structural gap in which Taiwan residents face full statutory U.S. withholding rates on U.S.-source income while residents of nearly every other major economy benefit from treaty-reduced rates. S199 offers a unilateral, statute-based substitute for a treaty — a politically necessary workaround given Taiwan’s diplomatic status — and its design will shape who bears the cross-border tax burden on investment, services, and employment income flowing between the two economies.