Exactly two months after the U.S. Supreme Court struck down the Trump Administration’s additional tariffs imposed under the International Emergency Economic Powers Act (IEEPA), the process has officially begun for companies to obtain refunds for the additional tariffs paid. 

On April 20, Customs and Border Protection (CBP) launched the first phase of tariff refunds using its new Consolidated Administration and Processing of Entries (CAPE) functionality within the Automated Commercial Environment (ACE).

Under Phase 1, Importers of Record (IORs) and Customs brokers can now file CAPE Declarations for certain unliquidated entries and certain entries within 80 days of liquidation. A CBP webpage provides thorough details and FAQs(Opens a new window)(Opens a new window)(Opens a new window); read on for summary and highlights.

Background: The ruling and what it said about refunds

On Friday, Feb. 20, the U.S. Supreme Court issued a landmark decision striking down the IEEPA tariffs, ruling that the President exceeded the authority granted under IEEPA. To date, the federal government had collected over $100 billion(Opens a new window)(Opens a new window)(Opens a new window) in excess IEEPA-imposed tariffs.

The Supreme Court majority’s opinion ruling that the tariffs were unconstitutional did not address how companies should obtain refunds, or direct a lower federal court to devise a refund process or request the Administration to prepare one.

On March 5, the U.S. Court of International Trade (CIT) ordered(Opens a new window)(Opens a new window)(Opens a new window) CBP to issue said refunds.

CBP introduces refund process via ACE

In March, CBP outlined a potential administrative process to refund IEEPA tariffs, specifically by modifying its ACE system to enable the processing of IEEPA tariff refunds. The first phase of the process went live April 20. 

What is CAPE?

The new ACE functionality, referred to as the Consolidated Administration and Processing of Entries (CAPE), includes four integrated components:

• Claim portal: Importers submit a declaration containing the entry numbers associated with imports subject to IEEPA tariffs (CAPE Declaration), which CBP will then validate.
• Mass processing: CBP will recalculate tariffs as if the IEEPA tariffs had not been imposed.
• Review and liquidation/reliquidation: CBP will calculate the refund amount, representing the difference between the tariffs paid and the amount that would have been due absent the IEEPA tariffs.
• Refund: CBP will process the resulting refunds.

What should companies do now?

Key takeaways from CBP’s guidance page include:

• Who can file: Only the Importer of Record (IOR) or the licensed customs broker who filed the entries can file a CAPE Declaration; for example, attorneys cannot file on an importer’s behalf. Phase 1 of CAPE is limited to certain unliquidated entries and certain entries within 80 days of liquidation.
• Where to file: IORs and authorized Customs brokers must have an established ACE Secure Data Portal account, and use the ACE Portal to provide CBP with bank account information for receiving refunds.
• What to file: A CAPE Declaration consists of a list of entries for which refunds of IEEPA duties are being requested. Declarations must be filed as Comma-Separated Values (.CSV) files, each limited to 9,999 entries; multiple declarations can be filed.
• Refund timing: CBP states: “Importers and authorized brokers should anticipate that valid IEEPA refunds will generally be issued within 60 - 90 days following acceptance of the CAPE Declaration, unless a compliance concern requires further CBP review. However, certain scenarios, such as entries that are extended, suspended or under review, and warehouse entries, will maintain their liquidation status with validated refunds issued at liquidation.”

Visit CBP.gov(Opens a new window)(Opens a new window)(Opens a new window) for further details, as well as updates as they become available.

Understanding your refund amount

While CBP indicates that it will directly calculate the refund amount due, we expect that that process could lead to greater scrutiny of underlying import assumptions, which could impact expected refund amounts. In anticipation, companies may want to “gut check” the veracity of CBP’s expected calculation. CohnReznick can help importers test the veracity of their expected refund amounts.

Selling tariff refund claims

Importers who need liquidity or do not want to wait for a refund have the option to sell their refund claim to a “claims buyer.” Before selling any IEEPA tariff refund, companies should carefully consider their unique financial circumstances. 

Prepare for what comes next

The Supreme Court’s invalidation of the 2025 IEEPA tariffs is one of the most significant trade developments of the year – and a major potential financial opportunity. CohnReznick stands ready to help you with the practical work required to assess exposure and quantify potential recoveries. Reach out to us to get started.