UPDATE:Following the March 4, 2026, ruling from the Court of International Trade directing CBP to refund duties imposed under IEEPA tariffs, CBP has released new guidance. Read more here for the latest updates, including CIT’s decision to suspend immediate refunds in order to allow CBP’s new refund process to be put into place.
On March 4, 2026, the Court of International Trade (CIT), in the case of Atmus Filtration, Inc. v. United States, issued an order directing the CBP to refund duties imposed under the IEEPA following the Supreme Court ruling. The CIT’s order requires CBP to take action to liquidate, or reliquidate, affected entries by removing the IEEPA duties. This applies broadly to all unliquidated entries subject to those duties, as well as to liquidated entries for which liquidation is not yet final.
New 10% tariffs are now in effect for imports from every country, marking the latest shift in an already volatile U.S. tariff landscape. These tariffs were implemented on February 24, 2026 under Section 122 of the Trade Act 1974 after a U.S. Supreme Court ruling deemed International Emergency Economic Powers Act (IEEPA) tariffs unconstitutional. Here is guidance for importers to understand their next steps in transitioning from IEEPA to Section 122 tariffs and obtaining refunds related to IEEPA tariffs. This is not the time to wait and see, importers need to prepare today to give them the best chance at receiving correct refunds from IEEPA tariff over-payments. Equally importantly, importers need to start/continue having strategic discussions with their advisors around tariff mitigation strategies to make sure they are declaring the lowest possible dutiable customs value that is only related to the actual products. The best candidate for these tariff mitigation strategies are those companies with related party supply chains.
Court Ruling Triggers Immediate Shift of Tariff Focus
The recent U.S. Supreme Court ruling determined that the U.S. Administration lacked authority to impose sweeping tariffs under IEEPA. These are the “Liberation Day” fluctuating country-specific tariffs and the Fentanyl tariffs. As a result, IEEPA-based tariffs have been revoked, while a new, broad-based tariff regime has taken their place. Following the Supreme Court’s ruling, the White House announced the new 10% tariffs, impacting every country. It also revoked the IEEPA tariffs at the center of the case, while confirming the de minimis suspension continues which had previously allowed goods valued at $800 or less to enter the U.S. without paying any tariffs.
Guidance from the U.S. Customs and Border Protection agency (CBP) includes an announcement that it will start applying Section 122 tariffs on imported goods, as of February 24, 2026. CBP also released guidance on how to apply the new Section 122 tariffs and exemptions to those tariffs. The agency will update its Automated Commercial Environment (ACE) portal to reflect these changes.
Understanding Scope and Exemptions Under Section 122
Importers will need to begin immediately paying the new Section 122 tariffs that replaced the previous IEEPA ones. Here’s what you need to know:
- Section 122 of the Trade Act 1974 allows the administration to put temporary tariff of up to 15% on imported goods for a maximum 150 days, after which they must seek Congressional approval.
- Currently, Section 122 tariffs implemented are 10% across the board for every country. While there was talk of using 15%, only 10% ultimately made it into the White House Executive Order.
- The 10% tariffs replace any recently negotiated and signed trade agreements by the U.S. with other nations since they were negotiated using now unconstitutional IEEPA measures.
- Any smaller tariffs that have been in place since the first administration remain, so this 10% is a stacking tariff on that.
- There are exemptions to these new Section 122 tariffs, which are outlined in the CBP guidance and largely mirror the exemptions to the IEEPA tariffs, including:
- Certain critical minerals
- Metals used in currency and bullion
- Energy and energy products
- Natural resources and fertilizers that cannot be obtained in the United States
- Certain agricultural products, including beef, tomatoes and oranges
- Pharmaceuticals and pharmaceutical ingredients
- Certain electronics
- Passenger vehicles, light trucks, medium- and heavy-duty vehicles, buses and related parts
- Certain aerospace products
- Information materials like books, donations and accompanied baggage
- Articles subject to Section 232
- United States-Mexico-Canada Agreement-compliant articles
- Textile and apparel articles that are entered free of duty under the Dominican Republic-Central America Free Trade Agreement
What Importers Should Do TODAY
With all of the back-and-forth on tariffs, it can be difficult to know what immediate steps to take. The first step? Stop paying IEEPA tariffs immediately and start paying the new Section 122 tariffs that replaced them. The second step? Importers need to work within the ACE system to create a report distinguishing between custom entries that have liquidated (shipments over 314 days), and the ones that have not so they clearly understand what IEEPA tariffs were paid and when.
The third step? Confirm the exact type of tariff for each entry in this report, along with the amounts paid, to ensure the importer knows their exact refund eligible amount from IEEPA tariff over payments.
Importers need to be armed with this information to be prepared. Note that while the CBP, following the CIT’s order issued on March 4, 2026, is expected to liquidate/reliquidate all customs entries by removing any IEEPA duties, there will be more clarity provided on the tariff refund process post the CIT conference scheduled for March 6, 2026.
Take Action: Refund Pathways Based on Entry Status
Yes, there is uncertainty, but importers need to take action to protect their ability to get IEEPA refunds. With all of the back-and-forth on tariffs, it can be difficult to know what immediate steps to take so here are some practical steps.
- Obtain a report from your customs broker – or CBP ACE system directly if you have access – to get the status of ALL customs entries where IEEPA tariffs apply. Make sure you track the status and dates, based on these 3 high level categories of entries.
- Track as three possible categories of Customs Entries:
- Unliquidated Entries. CBP typically finalizes (liquidates) customs entries within 314 days of entry on the ACE system. Determine the unliquidated entries (shipments less than 314 days) and the dates of liquidation for each entry.
- Action: Be prepared to correct the CBP ACE system by filing Post System Correction (PSC) on the unliquidated entries. The company can work with their customs broker, an advisor, or on their own to take this first step for unliquidated entries, if/when needed. The company can work with their customs broker, an advisor, or on their own to take this first step for unliquidated entries. Following the CIT’s order issued on March 4, 2026, the CBP is expected to liquidate these entries by removing any IEEPA duties automatically without the need for filing PSCs, however, more clarity will be provided post the CIT conference. For now, the Importer should know their exact IEEPA refund position in anticipation of upcoming further guidance on whether they should initiate this PSC work, or whether CBP will initiate.
- Liquidated Entries, within 180 days. Determine liquidated entries that are still within the 180-day protest window (i.e., 180 days after the 314-day liquidation date).
- Action: File a protest with CBP. Companies would typically need to rely on customs brokers or attorneys to do this.
- Liquidated Entries, past 180 days. Determine liquidated entries that are past the 180-day protest window.
- Action: File a lawsuit with the Court of International Trade. Speak to a trade and customs attorney to guide you through.
- Unliquidated Entries. CBP typically finalizes (liquidates) customs entries within 314 days of entry on the ACE system. Determine the unliquidated entries (shipments less than 314 days) and the dates of liquidation for each entry.
See more detailed guidance in our recent article, Three Options to Pursue a Refund on IEEPA Tariff Over-Payments.
Navigate New Global Trade and Tariff Environment
Increasing tariffs signify a substantial shift in global trade policy. Withum can assist your business in creating an actionable plan to drive decision-making using our proprietary scenario modeling tool and our expertise in global trade, supply chain, transfer pricing and tariffs.
Parallel to Refunds, Importers Need to Seek Strategic Tariff Mitigation
Beyond immediate compliance steps, importers should also reassess longer-term mitigation strategies. There are several ways importers can approach tariff mitigation to reduce the dutiable customs value, even as this remains a fluid and changing situation. Continue using the following strategies (or start, if you haven’t yet):
- First Sale for Export: If the company’s supply chain involves a middleman purchasing products between a foreign factory and a U.S. importer.
- Economic Analysis: Analyze transfer pricing on a transaction (versus profitability) basis so the product price is not inflated by service or other noise. Determine what is and is not an “Assist” to get this right.
- Supply Chain Restructuring: Rework part of the global supply chain so your product does not enter the U.S. if it is ultimately destined for Canada, Mexico or elsewhere.
Note that there are a variety of strategies that can be implemented to quantify reducing the dutiable customs value, and they are unique and specific to the company’s fact patterns and supply chains.
Conclusion
With the ever-changing tariff landscape, it’s important to remain on top of the latest updates and changes. The Supreme Court’s ruling, while a win for importers, means there are more responsibilities importers need to consider when it comes to pursuing refunds. The latest 10% tariffs from the Trump Administration also require attention and adherence. Finally, be proactive in understanding the ripple effect on your global business and seeking guidance from your transfer pricing, international tax, and supply chain advisors to come up with solutions that reduce your tariff costs via economic analyses to lower your dutiable customs value.
We will continue to monitor the progress and update this article accordingly.
Authors: Marina Gentile, Partner and Lead, Global Transfer Pricing Strategies | [email protected] and Mukul Chhabra | [email protected]
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