"It is with much sadness that we have decided to end our engagement," the Bachelor in Paradise stars said in a joint statement released to Us Weekly.
"We put everything we could into our relationship and are heartbroken to go forward separately, but we know this is the best decision for the both of us. We will still be present in each other's lives with support, admiration and respect for each other."
Taylor and Derek met onBachelor in Paradise's fourth season last summer and got engaged on the season's finale.
Afterward, the couple had surprised viewers by revealing they planned to maintain a long-distance relationship despite their engagement.
"We're not looking to necessarily go straight to living together," Derek, a commercial banker in Iowa, told People in September.
"We probably won't see that for a while, added Taylor, a mental health counselor in Seattle, WA.
"He's open to coming to Seattle. We also want to have that normal romance that might seem a little boring like going over to your boyfriend's house, we haven't really had that. So we want to hold off on living with each other for a while."