This February, in one of its most anticipated decisions of the year, the U.S. Supreme Court held that the International Emergency Economic Powers Act (“IEEPA”) does not authorize tariffs imposed under that statute by President Trump. See Learning Resources, Inc. v. Trump, Nos. 24-1287 & 25-250, 2026 U.S. LEXIS 714 (2026). Approximately 330,000 importers who paid IEEPA tariffs since early 2025 may be entitled to refunds. U.S. Customs and Border Protection (“CBP”) estimates that the affected tariffs total over $166 billion in payments across about 53 million separate entries. The mammoth task of processing these refunds is now under review at the Court of International Trade (“CIT”).
On March 4, 2026, in Atmus Filtration, Inc. v. United States (No. 26-01259), Judge Richard K. Eaton of the CIT ordered CBP to issue immediate refunds of IEEPA tariffs for all unliquidated entries and for all liquidated entries that have not yet become final. The order is silent, and the path forward remains uncertain, for any refunds of liquidated entries that have become final. Although this ruling comes in just one of the nearly-2,000 IEEPA-related refund cases pending before the CIT, the court made clear that its order applies broadly. The order applies to all unliquidated entries and liquidated entries that are not yet finalized; this is regardless of whether the importer has filed a lawsuit or administrative protest. (“Liquidation” refers to the process of finalizing the amount of import duties owed for an entry into the country, which CBP generally must complete 314 days after entry, assuming no suspension or extension applies. After liquidation, importers generally have 180 days to file a protest at CBP to request a refund.)
But importers should not expect “immediate” refunds just yet. On March 6th, the Executive Director of CBP’s Trade Programs Directorate, Brandon Lord, filed a declaration with the CIT outlining the administrative challenges for CBP in processing so many refund claims. The declaration proposes a new refund system to make the process more efficient, which CBP intends to make “ready for use in 45 days” (mid-April 2026). Following a March 6th status conference, the court suspended the requirement for “immediate” refunds while it considers CBP’s new proposed refund procedure.
According to Mr. Lord’s court filing, the new refund process would be set up within CBP’s existing Automated Commercial Environment (“ACE”) system and would operate as follows:
- The importer files a declaration in ACE that includes a list of entries on which IEEPA duties were paid.
- ACE runs a series of validations on each entry within the declaration and automatically re-calculates the duty owed without the IEEPA tariffs (with applicable interest).
- CBP verifies the declaration and processes refunds as soon as practicable.
- ACE automatically finalizes (liquidates or reliquidates) the entries.
- ACE automatically aggregates the refunds with interest by importer and liquidation date.
- CBP certifies the refunds.
- The Department of the Treasury issues IEEPA refunds electronically.
Notably absent from the CBP declaration is an estimate of how quickly refunds could be processed using the new system. But the declaration does state that the new system would “save CBP over 4 million hours compared with the manual processes it would otherwise have to complete.”
The CIT’s order is still subject to appeal, and it is possible that the government will argue on appeal, as it has previously, that refunds are limited to importers who have filed a CIT suit. So, importers should consider filing protective actions at the CIT and actively file CBP protests for newly liquidated entries before the 180-day protest period expires.
Additionally, it is possible that the government will attempt to require importers to pass on tariff refunds to customers or otherwise attempt to reduce refunds of tariffs passed on to third parties. Such enforcement efforts could face significant legal obstacles as the importer of record is the party responsible for paying tariffs and, accordingly, is generally the sole party entitled to any refunds. However, importers do need to consider whether they might have contractual obligations that require them to pass through any refunds to customers or other third parties.
IEEPA refunds present significant opportunities for businesses. Importers should compile necessary documentation to use CBP’s proposed refund procedure, including entry summaries and related records. Further, importers should ensure that they have an account set up in the ACE system, are registered to receive electronic refunds, and that their banking details in that system are accurate. They should continue to monitor CIT and CBP guidance and consult with trade advisors as the refund framework develops.
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If you have any questions about the tariff refund process, please reach out to Tommy Zaino or one of our other ZHF professionals.