IEEPA Tariffs Struck Down: $175 Billion in Refunds, What Importers Must Do Now

On February 20, 2026, the Supreme Court ruled 6-3 that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose broad-based import tariffs. The decision immediately invalidated tariffs that had generated an estimated $175–179 billion in collections. For importers, the ruling creates an unprecedented refund opportunity — but only if you act before liquidation deadlines close.

This guide covers the ruling, the refund mechanics, the government's Section 122 response, and the exact steps importers and customs brokers should take right now to preserve their claims.

The Ruling: What the Supreme Court Actually Said

In a 6-3 decision (Roberts, Sotomayor, Kagan, Gorsuch, Barrett, and Jackson), the Court held that IEEPA — a 1977 statute designed to address national security emergencies — does not grant the President authority to impose tariffs on imported goods.

The key findings:

• IEEPA authorizes sanctions, not tariffs. The statute allows the President to block transactions, freeze assets, and restrict economic dealings with foreign entities. Imposing duties on imports to the United States is a fundamentally different power — one the Constitution reserves to Congress under Article I, Section 8.
• Tariff authority requires explicit delegation. Congress has delegated tariff authority through specific statutes: Section 301 (unfair trade practices), Section 232 (national security), Section 201 (safeguards), and Section 122 (balance of payments). IEEPA is not among them.
• The emergency declaration was not sufficient. Even assuming a legitimate national emergency, IEEPA's text does not extend to customs duties. The Court declined to read tariff power into a statute that never mentions it.

The Financial Impact: $175–179 Billion in Collections

Since early 2025, IEEPA-based tariffs had been applied across a wide range of imports, generating massive revenue for the federal government. The tariffs were classified under HTSUS heading 9903.01.28 and applied as additional ad valorem duties layered on top of existing tariff rates.

Multiple analyses from PwC, Holland & Knight, and Ropes & Gray have estimated total IEEPA tariff collections at $175–179 billion. With the legal basis now struck down, these collections are potentially refundable to the importers who paid them.

The operative word is "potentially." Refund eligibility depends on two factors: liquidation status and timely protest.

Refund Mechanics: How to Preserve Your Claims

Understanding Liquidation

When CBP processes an entry, it eventually "liquidates" it — finalizing the duty amount. Once an entry is liquidated and the 180-day protest window closes, the duty assessment becomes final and irrevocable. No refund is possible after that point, regardless of subsequent legal developments.

CBP generally liquidates entries within 314 days of the date of entry, though extensions are common. The critical question for every importer is: which of your entries are still unliquidated, and which ones have been liquidated but are still within the 180-day protest window?

Step 1: Identify Your IEEPA-Affected Entries

Pull every entry since early 2025 where you paid duties under HTSUS 9903.01.28 or any IEEPA-related tariff provision. Your broker's entry summary data should identify these. Key fields to check:

• HTS codes with 9903.01.xx additional duty provisions
• Any entry where the duty rate included an IEEPA surcharge component
• All entries from countries subject to IEEPA tariff actions (broad — check every origin country)

Step 2: Check Liquidation Status

For each identified entry, determine whether it has been liquidated:

• Unliquidated entries: You can file a Prior Disclosure / Voluntary Tender to request reliquidation without the IEEPA duty component. You can also request suspension of liquidation pending final resolution.
• Liquidated entries (within 180 days): File a formal protest under 19 U.S.C. § 1514. The protest must specifically challenge the IEEPA tariff component and cite the Supreme Court ruling.
• Liquidated entries (past 180 days): Generally no refund path available. However, consult with a trade attorney about potential extraordinary relief under 19 U.S.C. § 1520(d) or Court of International Trade jurisdiction.

Step 3: File Protests and PSCs Immediately

Do not wait for CBP to issue guidance. Do not wait for implementing regulations. The liquidation clock does not pause while agencies deliberate. For every eligible entry:

• File Post-Summary Corrections (PSCs) for unliquidated entries to remove the IEEPA duty component
• File formal protests for liquidated entries still within the 180-day window
• Request suspension of liquidation for entries approaching the liquidation deadline

Multiple law firms (Holland & Knight, Ropes & Gray, WilmerHale, Covington) have published guidance urging immediate action. The consensus: file now, refine later. A timely but imperfect filing preserves your rights. A perfect filing submitted after the deadline preserves nothing.

The Government's Response: Section 122 Tariffs

Within hours of the ruling, the White House issued an Executive Order imposing a new 10% "Temporary Import Surcharge" under Section 122 of the Trade Act of 1974. Key details:

• Rate: 10% ad valorem on most imports
• Effective date: February 24, 2026
• Statutory limit: 150 days without Congressional approval (expires approximately July 24, 2026)
• Exemptions: USMCA-qualifying goods, Section 232 products (steel/aluminum), specific Annex II categories (copper, pharmaceuticals, semiconductors, lumber, critical minerals, energy, civil aircraft, CAFTA-DR goods)

Section 122 is a valid tariff authority — unlike IEEPA, Congress explicitly designed it to allow temporary import surcharges to address balance of payments problems. The legal basis is stronger, but the 150-day clock creates significant uncertainty about what comes next.

For a detailed breakdown of Section 122 classification impacts and exemption analysis, see our companion guide: Section 122 Tariffs: What Customs Brokers Need to Know About Classification Now.

What Comes Next: Three Scenarios

Scenario 1: Congress Authorizes Permanent Tariffs

If Congress passes legislation before the 150-day expiration, tariffs continue under new legal authority. The rates, exemptions, and covered products could change significantly. Classification decisions made under Section 122 may need full review under the new framework.

Scenario 2: Section 122 Expires Without Replacement

If the 150-day period lapses without Congressional action, the surcharge disappears. Importers would return to pre-IEEPA tariff rates (plus any remaining Section 301/232 duties). This is the optimistic scenario for importers but may trigger retaliatory action from trading partners who had adjusted to the tariff regime.

Scenario 3: Executive Action Under Other Authorities

The administration may attempt new tariffs under different statutory authority (Section 338, Section 301 expansion, or new national security findings under Section 232). Each authority has different procedural requirements, scope limitations, and legal vulnerabilities. Watch for Federal Register notices and USTR announcements.

New Section 301 Investigations: 16 Economies Targeted

Adding to the complexity, USTR announced new Section 301 investigations on March 11, 2026, targeting structural excess capacity across 16 economies: China, EU, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India.

These investigations could result in additional targeted tariffs on specific product categories — independent of the Section 122 surcharge. For importers sourcing from these countries, accurate HTS classification will determine which products fall within scope of any resulting tariff actions.

See our analysis: New Section 301 Investigations: 16 Economies Under Review.

Action Checklist for Importers

1. Audit all IEEPA-affected entries since 2025. Identify every entry where IEEPA tariffs were paid. Prioritize by dollar value.
2. Check liquidation status for every entry. Separate into unliquidated, liquidated-within-180-days, and liquidated-past-180-days.
3. File PSCs for unliquidated entries immediately. Remove the IEEPA duty component. Don't wait for CBP guidance.
4. File formal protests for recently liquidated entries. Cite the Supreme Court ruling. The 180-day clock is running.
5. Request suspension of liquidation for entries approaching the liquidation deadline.
6. Review classifications for Section 122 exemptions. USMCA, Section 232, and Annex II carve-outs may apply to your products.
7. Verify HTS codes are accurate. With tariff rates in flux, classification errors carry amplified financial risk. An incorrect HTS code could mean paying the surcharge when you qualify for exemption — or missing a protest deadline because you didn't realize a product was affected.
8. Engage a trade attorney for entries with significant refund potential. The legal landscape is evolving daily.
9. Subscribe to regulatory updates. Monitor CBP CSMS notifications, Federal Register, and Harmonize Trade Alerts for weekly digests.

Key Takeaways

• The Supreme Court ruled 6-3 that IEEPA does not authorize tariffs. $175–179 billion in collections are potentially refundable.
• Refund eligibility depends on liquidation status and timely protest filing. Deadlines are fixed and approaching.
• File PSCs and protests now. A timely imperfect filing preserves your rights; a late perfect filing does not.
• Section 122 tariffs (10%) replaced IEEPA tariffs effective February 24, with a 150-day statutory limit.
• New Section 301 investigations targeting 16 economies add further complexity to the tariff landscape.
• Accurate HTS classification is the foundation of every refund claim, exemption application, and compliance decision.

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This article is for informational purposes only and does not constitute legal or customs brokerage advice. Importers and brokers should consult with a licensed customs broker or trade attorney for guidance on specific refund claims and compliance decisions. Harmonize.ai is a classification research tool operating under 19 U.S.C. § 1641 — we provide research support, not customs brokerage services.