Companies that have spent the last several years absorbing record-high import costs are finally on the verge of a financial reprieve following a landmark Feb. 20 Supreme Court decision that struck down the Trump administration’s emergency IEEPA tariffs.
However, the path from legal victory to actual bank deposits remains complicated. The government is rapidly building a mass refund system, but importers cannot simply sit back and wait for a check to arrive. Taking proactive steps is necessary to prevent the government from keeping a portion of those funds on technicalities, according to Chris Duncan, a former attorney for U.S. Customs and Border Protection (CBP) who served for 16 years and now works on customs issues in private practice for Squire Patton Boggs.
Actions to Take Now for Tariff Refunds
Based on recent court developments, Duncan highlighted two critical actions every eligible company should take right now to protect their tariff refunds. These are simple steps that do not involve filing a lawsuit or racking up huge legal fees:
- File an administrative protest with CBP regarding liquidated, or finalized, customs duties already paid.
- Set up ACH banking details with CBP, which is mandatory to receive any tariff refunds.
“There’s a lot of money at stake here with the refunds,” Duncan said. “People shouldn’t be swayed by, ‘I don’t want to stick my neck out. I don’t want to put in the effort.’ It’s your money. You lost the ability to use those liquid assets for that period of time. You are entitled to get it back — with 7% interest.”
For some of Duncan’s larger clients, tens of millions of dollars are at stake. For smaller companies, hundreds of thousands of dollars.
“For almost every client, when we do the calculations, it’s way more money than they thought,” he said.
Liquidated Versus Unliquidated Entries
The new government tariff refund system that is being built, called the Consolidated Administration and Processing of Entries (CAPE), will primarily process unliquidated entries. Understanding the difference between liquidated and unliquidated shipments is vital for importers trying to secure their money, Duncan said.
When a company imports goods, they file paperwork declaring the merchandise value, classification, and estimated duties owed. The importer then pays a cash deposit based on those calculations.
By law, the government has one year from the date of entry to review the paperwork, ask questions, or make changes, or the customs entry is deemed liquidated, or finalized. By policy, CBP liquidates entries after 314 days, Duncan said.
Entries that are still within CBP’s initial 314-day review period are considered unliquidated, or not finalized.
The new government refund system being built is designed to handle the more recent, unliquidated entries that are still within the initial 314-day review period.
However, older shipments that were subject to IEEPA tariffs that have already passed the liquidation date require immediate manual intervention from the importer, Duncan said.
Crucial Step One: File a Protest Immediately
The most urgent advice for importers involves shipments that have already liquidated. According to Duncan, the government has pushed back against automatically refunding these finalized entries. He believes the government is hoping that many smaller, unsophisticated businesses will simply miss the administrative deadlines.
Once an entry liquidates, the importer has exactly 180 days to file an official protest if they want to challenge the tariffs paid. If a company fails to file a protest within that 180-day window, they forever waive their legal right to secure a refund. Because the earliest China fentanyl tariffs were implemented in early 2025, those initial entries began liquidating in December, Duncan said. The 180-day clock is actively ticking down for thousands of shipments.
Duncan advises that importers pull reports of all their entries where IEEPA tariffs were paid and track the liquidation dates. Filing a protest with CBP is a highly common, straightforward administrative task that a customs broker or even a company can handle internally, he said. It simply requires stating that the company paid IEEPA tariffs, the Supreme Court ruled them unlawful, and the company is requesting a refund with interest.
“It is fairly easy to do,” Duncan said. “It’s not a legal filing; it’s an administrative filing with customs that is very common. These are not overly complicated.”
If your company has a lot of money at stake, however, you may want to use a lawyer or broker to make sure everything is filled out correctly given the 180-day protest window, he said.
Taking this simple administrative step ensures companies preserve their rights without absorbing massive legal fees, Duncan said.
The judge overseeing this case in the U.S. Court of International Trade, Judge Richard Eaton, flagged the need for importers to file protests for liquidated customs duties paid after the government recently said it would not refund already finalized customs duties via the new CAPE system.
“The judge basically in his latest order said ‘Whoa, whoa, whoa, importers, you better watch out because the government here is saying not every entry is going to be captured by this new administration system, CAPE,’” Duncan said. “The judge said you better file protests to protect your rights to ensure you can get the refunds through the protest process if customs isn’t going to do it through this separate administrative process.”
Crucial Step Two: Set Up the ACH System
The second major hurdle is an administrative rule change that has the potential to derail payouts for many companies. The government will no longer mail paper checks for tariff refunds. All payments must be processed electronically through the Automated Clearing House (ACH) banking system.
If a company is not properly registered for electronic transfers inside the customs data portal, the government will reject the refund, he said. Furthermore, a rejected payment results in the importer forfeiting their right to collect interest.
Currently, only a small percentage of importers have set up the ACH payment system. Out of the roughly 330,000 eligible importers, only about 6% have completed the necessary banking setup, the CBP reported in early March.
“Customs put this electronic ACH refund process in place very quietly,” Duncan said. “I think they’re actually counting on a lot of people not signing up for electronic refunds. And not being in the ACH system allows them to say, ‘Oh, there’s no way to give them the money back. So I guess we get to keep it.’
“Everybody needs to set this up, it’s so easily done,” Duncan added. “Your broker can do this for you, and you can also do it yourself. Make sure it’s not an excuse that they can use to not give you the refund — plus interest — back.”
Companies Are Owed 7% Interest
The interest attached to the tariff refunds is substantial, Duncan said. The government is statutorily obligated to pay 7% interest, accruing daily from the original date of the cash deposit. For companies that have had their capital tied up in illegal tariffs for over a year, this interest represents a massive financial windfall.
“There’s a huge chunk of interest money the government is going to have to pay out beyond the money they collected in tariffs,” Duncan said.
Duncan: Companies Deserve the Tariff Refunds
Because companies have been whipsawed for a year with the tariff crises and changes, it’s easy for executives to grow immune to the tariff noise and not realize how important it is for them to take action now.
“Some people are saying, ‘I don’t want to make the effort ..’” Duncan said. “But it’s your money. You paid it. Now, do you want to give it back to your customers as a rebate? Do you want to give it to charity? Do you want to give your employee bonuses? Or do you want to put it in the company coffers?
“But that’s your money, you were hassled, you had to pay it. The money should go to you, not the government,” Duncan added.
This article originally appeared on Emerald publication Shop Eat Surf Outdoor.
