March 24, 2026

Preparing for Tariff Refunds

On February 20, 2026, the Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) cannot be used to impose tariffs. The Court of International Trade subsequently ordered Customs and Border Protection (CBP) to issue refunds of those tariffs with interest, and CBP is now building a system to process claims. Businesses that were the importer of record may be eligible to recover those amounts, but businesses that purchased goods from a domestic supplier or distributor are generally not eligible. CBP has said the process involves more than $166 billion in duties collected from at least 330,000 importers. To help clients, prospects, and others, Wilson Lewis has summarized the key details below.

Background

IEEPA tariffs were imposed by executive order beginning in early 2025, applying broadly to imports from many countries. They were separate from other tariff programs such as Section 232 and Section 301, which remain in effect. Here is how the legal situation developed:

• February 20, 2026 — The Supreme Court ruled that IEEPA does not authorize the President to impose tariffs. The decision did not affect tariffs under other legal authorities and did not address refunds.
• March 4, 2026 — The Court of International Trade (CIT) ordered CBP to begin issuing immediate refunds of IEEPA tariffs, with interest. At that point, interest was reported to be accruing at about $650 million per month.
• March 6, 2026 — CBP asked the court for a 45-day extension to update its systems and prepare for the volume of refund activity. The court paused the immediate refund requirement while CBP worked on a process.
• March 12, 2026 — CBP informed the court it was building a new system (called CAPE) inside of its existing ACE Secure Data Portal. 
• March 20, 2026 — The court issued an order giving CBP additional time to develop CAPE. CBP must provide another update by March 31, 2026.

How the Refund Process Is Expected to Work

CBP’s new system, CAPE (Consolidated Administration and Processing of Entries), is being designed to handle claims on an importer or bulk basis rather than processing more than 53 million separate entry-level refunds. 

Refunds will not arrive automatically; businesses will need to file claims, provide supporting records, and follow CBP’s instructions throughout the process. Businesses that plan to receive refunds electronically should also confirm they are enrolled in ACH Refund, which CBP requires for electronic duty payments.

CAPE has four main components:

• Claim portal — Importers submit refund requests, identifying affected entries and providing supporting documentation.
• Mass processing — CBP reviews claims for each importer, rather than treating each entry as a separate refund event; IEEPA tariff codes are removed and duties are recalculated. 
• Review and liquidation or reliquidation — Individual entries are reviewed and finalized for duty purposes.
• Refund — Approved amounts plus interest are paid out to importers.

There are also open questions about which entries qualify. Most entries from the past year or so are unliquidated, meaning CBP has not yet finalized what was owed, and those are the clearest cases for a refund. Entries that have been reviewed and closed more recently may also qualify, as long as there is still an adjustment window open. Final liquidated entries may not qualify, and CBP has not yet defined whether or how those entries will be eligible.

A user guide covering scope and functionality is expected as the system continues to develop. Until that guidance is released, businesses should focus on identifying affected entries, confirming their liquidation status, and organizing the records they are likely to need.

Next Steps

• Identify affected entries. Determine which entries were subject to IEEPA tariffs and estimate the amount potentially recoverable.
• Gather documentation. Pull entry summaries, duty payment records, importer-of-record details, broker reports, and related customs documents now.
• Enroll in ACH Refund. CBP requires ACH enrollment for electronic duty refunds. Businesses that are not set up should address that now.
• Coordinate with advisors. They can help confirm entry status, prepare records, and address the accounting and tax treatment of refunded duties and interest.
• Monitor updates closely. The process is still developing, and the court has required continued reporting from CBP.

Contact Us

Importers will soon have a path to recover IEEPA tariffs, but the process is not automatic and requires businesses to act. Businesses that paid IEEPA duties should prepare for when more guidance becomes available. If you have questions about the information outlined above or need assistance with another tax or accounting issue, Wilson Lewis can help. For additional information call 770-476-1004 or click here to contact us. We look forward to speaking with you soon.