On Friday, Feb. 20, 2026, the U.S. Supreme Court issued a landmark decision striking down the Trump Administration’s additional tariffs imposed under the International Emergency Economic Powers Act (IEEPA), and ruled that the President exceeded the authority granted under IEEPA. To date, the federal government collected over $100 billion(Opens a new window) in excess IEEPA-imposed tariffs.

This ruling opens the door for companies to obtain refunds for the additional IEEPA tariffs that they paid. However, no clear process to apply for, or receive, those refunds was included in the decision – that is yet to be determined.

What this decision said about refunds

The Supreme Court’s majority’s opinion ruling that the tariffs were unconstitutional did not address the obvious impact of its decision; that is, how should companies obtain refunds. In fact, the word “refund” appears nowhere in the majority’s opinion. Justice Kavanaugh, in a dissenting opinion, however, stated(Opens a new window):

[t]he Court’s [majority] decision is likely to generate serious practical consequences in the near term. One issue will be refunds. Refunds of billions of dollars would have significant consequences for the U. S. Treasury. The Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers. But that process is likely to be a “mess,” as was acknowledged at oral argument.

Some legal scholars had surmised that if the Court found that the IEEPA-imposed tariffs were unconstitutional, then the Court might direct a lower federal court to devise a refund process or request the Administration to prepare one. Alas, the Court did no such thing.

What should companies do now?

In the absence of any special Court directive on the refund process, the preexisting tariff dispute rules will continue to apply. Accordingly, companies that want refunds will need to dispute the tariffs that they paid with the Customs and Border Protection (CBP), the federal agency that monitors imports and collects tariffs.  A federal court, the Court of International Trade (CIT), has jurisdiction to resolve tariff disputes, and, to that end, to date, thousands of companies have proactively filed complaints with that court seeking refunds, in anticipation that the Court would find the IEEPA-imposed tariffs unconstitutional. The CIT will be buried under an avalanche of complaints seeking refunds. Justice Kavanaugh may be right that the refund process will be a “mess,” but that is no reason for companies to pass on their rights to seek refunds.

How will refunds be calculated?

Importers seeking refunds will be required to substantiate their claims.  Specifically, we anticipate that importers will need to prepare analyses that compare:

(a) the tariffs actually paid

(b) the Tariffs that would have been paid in the absence of the tariff increase under IEEPA

Those analyses will likely need to be prepared on an item-by-item basis based on the date of each import. These analyses, in short order, can become highly detailed and complex.

Importers that use freight forwarders to manage their imports may need to obtain the relevant underlying import supporting documents from those companies.  Other companies’ accounting and enterprise resource planning (ERP) systems may not maintain the required data with the requisite granularity. Regardless, importers will likely need forensic accounting support and trade compliance expertise to assemble, reconcile, and validate refund calculations capable of withstanding detailed scrutiny.

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 is prepared and available to help you.