IEEPA tariff refunds: The recent CIT ruling and Section 122 updates
- The latest CIT ruling may allow refunds of IEEPA tariffs paid on past imports.
- Section 122 tariffs are now in effect and may increase to 15%.
- Eligibility for tariff refunds depends on liquidation timing and documentation.
On February 20, the U.S. Supreme Court ruled that President Trump lacks the legal authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA). The landmark IEEPA ruling has not only invalidated billions in collected duties but has also triggered a complex race for tariff refunds.
While the IEEPA tariffs were officially lifted on February 24, they were immediately replaced by a new 10% rate under Section 122 of the Trade Act of 1974.
Here’s an overview of the latest status of tariff refunds and what to expect as current duty rates are projected to rise:
What are the latest updates on IEEPA tariff refunds?
Several critical tariff changes have occurred since the February 20 IEEPA ruling:
- Section 122 increase: On March 4, 2026, Treasury Secretary Bessent announced that the Section 122 tariffs will increase to 15%, without confirming an effective date or specifying which countries will face the increase.
- CIT refund mandate: On March 4, 2026, the Court of International Trade (CIT) issued an order directing the government to process tariff refunds.
Specifically, the judge on March 4, 2026, ruled that Customs and Border Patrol (CBP) must:
- Liquidate all unliquidated entries without IEEPA duties, meaning that any entry that has not yet been finalized must now be closed out without IEEPA duties.
- Reliquidate eligible liquidated entries without IEEPA duties, meaning entries that have already been finalized but remain within the 180-day post-liquidation protest period must be reopened, and IEEPA tariffs refunded.
On March 6, 2026, the CIT held a private conference to discuss the process following the CIT judge’s March 4 ruling directing the payment of refunds.
CPB responded to the CIT in a March 6, 2026, filing that stated:
- CBP refund response: The Automated Commercial Environment (ACE) system cannot automatically process refunds at this scale.
- CBP is requesting 45 days: CBP also stated in the filing that the agency is preparing a system to process tariff refunds, which will be ready in 45 days.
CBP has also told the CIT that the agency currently lacks the staff or software capacity to review and process roughly 53 million import entries from 330,000 importers.
How does the CIT ruling on tariff refunds affect your business?
The shift from IEEPA to Section 122 has created a complex landscape for current duty rates. While the CIT ruling provides a path for tariff refunds, the IEEPA ruling triggered an immediate replacement of the old duty structure.
Businesses face potential impacts, including:
- Tariff refund eligibility: Only tariffs paid under the invalidated IEEPA authority are eligible for refunds. Duties paid under Section 122, 232, 301 or other authorities are not subject to the CIT’s recent refund order.
- Current duty rates: IEEPA tariffs will no longer be in effect. However, Section 122 tariffs set on February 24 at 10% and tariffs imposed under Section 232, Section 301 and general duty rates remain in effect.
- Increasing tariffs: Businesses should prepare for Section 122 tariffs to increase to 15% on select countries in the near future.
How can you file for a tariff refund?
The U.S. Court of International Trade is currently working to establish a process for refunds and eligibility.
For businesses looking to file for IEEPA tariff refunds, next steps include:
- Knowing your liquidation timeline: Identify whether your import has liquidated, and, if so, when liquidation occurred, to identify whether the import is within the window for reliquidation.
- Watching for refund updates: CBP still needs to establish how these initial refunds will be issued, but any refund will only be issued electronically via ACH — not physical checks.
- Understanding eligibility: If you are the importer of record and have an ACE account, you will be eligible for the refund based on the rules to date. You do not need to file a lawsuit to be eligible for the refund based on the CIT judge’s ruling.
- Gathering documentation: If you are not the importer of record with an ACE account, but you paid a portion of IEEPA tariffs to your supplier, you must go back and track what you paid to ensure you have documentation if you choose to go back to your supplier to request a portion of the refund they may receive. Make sure you note what tariffs were specifically paid under IEEPA, and remember your suppliers are not being refunded for any Section 232 or Section 301 tariffs.
Note that there are ongoing developments as the CIT continues to discuss and make decisions. To prepare for any future IEEPA tariff refunds, businesses should stay updated on rulings as they occur.
How Wipfli can help
Is your business ready for the next round of tariff changes? From navigating IEEPA refunds to analyzing the impact of current duty rates on your bottom line, Wipfli’s trade and tariff specialists can provide the strategies and guidance you need to stay ahead.
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