The "Taiwan Allies Fund Act" seeks to bolster Taiwan's international standing and counteract the People's Republic of China's (PRC) diplomatic isolation campaign. Congress finds that Taiwan is a vibrant democracy and a crucial contributor to global stability, yet the PRC has systematically pressured countries to sever diplomatic ties, as evidenced by numerous nations since 2013. The bill reaffirms the United States' commitment, building on the Taiwan Relations Act and the TAIPEI Act, to support Taiwan's official and unofficial relationships worldwide. The legislation establishes the Taiwan Allies Fund , authorizing $40 million annually for fiscal years 2026 through 2028, drawn from the Countering PRC Influence Fund. These funds are designated for countries that either maintain official relations with Taiwan, have strengthened unofficial ties, or face coercion from the PRC due to their relationship with Taiwan and lack the capacity to respond independently. Eligible activities include supporting health initiatives, building civil society resilience against PRC influence, diversifying supply chains away from the PRC, providing alternatives to PRC development assistance, and advancing Taiwan's participation in international organizations. The bill limits funding to $5 million per country per fiscal year and mandates the Secretary of State to coordinate implementation, encourage cost-sharing with Taiwan, and report annually to Congress on the fund's activities and effectiveness.