The Nigeria international has been deemed surplus to requirements at San Siro and has been allowed to join the Ukrainian club on an initial one-year loan deal.
Dynamo will pay a fee of €500,000 to take the 27-year-old for 12 months, and will then have the option to sign him outright for a further €2m, to be paid over the next three years.
Taiwo has disappointed in Italy since moving to the peninsula from Marseille last summer. He played only four games for the Rossoneri, before moving to QPR in January on a short-term loan basis.
The former Lobi Stars man will join the likes of Miguel Veloso and Niko Kranjcar who have recently joined the Ukrainian side.