Supreme Court Opens $166B IEEPA Tariff Refund Process
Summary
CBP launched the CAPE portal on April 20, 2026, enabling importers to seek refunds of IEEPA tariffs invalidated by the Supreme Court's February 20, 2026 decision in Learning Resources, Inc. v. Trump, No. 24-1287. The government owes an estimated $166 billion to approximately 330,000 importers, with the outstanding balance accruing approximately $650 million in interest monthly. Refunds are not automatic; only importers of record are eligible to apply, and approved applications are estimated to take 60 to 90 days to process.
Importers of record who have not yet enrolled in CAPE should do so immediately — enrollment is a prerequisite to filing a refund claim, and entries with outstanding Customs protests cannot be processed simultaneously. Businesses that passed IEEPA tariff costs to customers should evaluate their exposure to consumer pass-through claims before receiving refunds, as at least one major company has already committed to returning refund money to customers.
What changed
The Supreme Court held 6-3 in Learning Resources, Inc. v. Trump, No. 24-1287, that IEEPA does not authorize the President to impose sweeping tariffs, invalidating tariffs on imports from Canada, Mexico, and other countries including rates as high as 145% on Chinese goods. The Court of International Trade subsequently ordered the government to return the tariff money to importers. CBP has launched the CAPE portal for consolidated processing of refund claims.
Importers of record seeking refunds must apply through CAPE; the government estimates $166 billion owed across approximately 330,000 importers, with $650 million in monthly interest accrual. Entries with outstanding Customs protests are ineligible for immediate processing, creating a procedural tension with the 180-day protest deadline after liquidation. A secondary market for purchasing refund claims at a discount is emerging, and businesses face growing pressure to pass refunds through to consumers. CBP estimates 60 to 90 days for application processing, though that timeline carries significant uncertainty given the scale and ongoing policy uncertainty.
What to do next
- Importers should enroll in the CAPE portal to submit refund applications
- Importers with outstanding Customs protests should consult counsel on how protest status affects refund eligibility
- Importers must preserve protest rights by filing within 180 days of liquidation to avoid forfeiting refund rights
- Businesses should consult with legal counsel regarding potential consumer pass-through claims on tariff refunds
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Apr 21, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
April 21, 2026
The $166 Billion Question: What Importers Need to Know About the Tariff Refund Process
LinkedIn Facebook X ;) Embed If your business imported goods subject to the now-invalidated International Emergency Economic Powers Act (IEEPA) tariffs, you may be entitled to a substantial refund. As of April 20, 2026, the federal government has begun accepting refund applications through a new online portal, but importers should not rely on the system as the only path to recovery given ongoing technical and administrative challenges and the government's shifting approach to tariffs.
The Supreme Court’s Ruling
On February 20, 2026, in a 6-3 decision, the Supreme Court held in Learning Resources, Inc. v. Trump, No. 24-1287, that IEEPA does not authorize the President to impose sweeping tariffs. The ruling invalidated tariffs on imports from Canada, Mexico, and dozens of other countries, including rates as high as 145% on goods from China. In March, the Court of International Trade intervened and ordered the government to return the money to importers.
The CAPE Refund Portal
On April 20, 2026, U.S. Customs and Border Protection (CBP) launched the Consolidated Administration and Processing of Entries (CAPE) portal, a new online system through which businesses can request refunds for tariffs paid under the invalidated IEEPA orders. The scale is significant: the government owes an estimated $166 billion to approximately 330,000 importers, with the outstanding balance accruing roughly $650 million in interest each month, or about $22 million per day.
Building the CAPE system presented significant technical challenges. At the outset, CBP had no way to deposit money into the bank accounts of most importers. As of launch, over 56,000 importers have enrolled, accounting for 82% of IEEPA-related entries and approximately $127 billion in tariff deposits. Refunds are not automatic, and only importers of record are eligible to apply. CBP estimates that approved applications will take 60 to 90 days to process, though importers should be skeptical of that timeline, given the scale of the operation. Moreover, as we alerted clients here, the administration is imposing new tariffs under alternative statutory authority and has opened sweeping trade investigations in an effort to reimpose tariffs. The White House has declined to say whether it will attempt to return to court in a bid to halt some or all of the refunds. White House National Economic Council Director Kevin Hassett suggested that “alternative authorities” could reduce the amount owed importers “quite a bit.” Importers also face a procedural tension: entries with outstanding Customs protests are ineligible for immediate processing, yet importers who fail to file a protest within 180 days of liquidation risk forfeiting their refund rights. Businesses should work with their legal counsel to navigate this timing issue.
Secondary Market Options
For businesses that need cash now rather than waiting months for the refund process to play out, a secondary market is emerging. Hedge funds and financial services firms are offering to purchase importers' tariff refund claims at a discount. In exchange, the purchaser takes on the administrative burden and timeline risk of the CAPE process. The discount size reflects the uncertainty surrounding the refund timeline, the possibility of a government appeal, and the complexity of the claims process. This option may suit importers who lack the internal resources to manage the refund process or who have pressing liquidity needs, though businesses should evaluate the terms of any such arrangement with their advisors.
Consumer Pass-Through and Related Litigation
Another critical issue for businesses to anticipate is the growing pressure to pass tariff refunds through to consumers. Many companies passed tariff costs on to customers through higher prices for goods. Now that the tariffs have been invalidated, consumer advocates and class-action plaintiffs are demanding that businesses share the refund proceeds. At least one major company has committed to returning refund money to customers. Businesses should consult with their legal teams about their obligations and potential exposure to consumer claims as they begin to receive refunds.
Looking Ahead
The launch of CAPE represents meaningful progress toward resolving one of the largest tariff refund events in recent history. Importers should work with their counsel to act on multiple fronts, including enrolling in CAPE, preserving protest rights, preparing for potential consumer claims, and consulting with legal counsel, to protect their interests in a trade environment that remains uncertain.
;) ;) Report
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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Katten Muchin Rosenman LLP
2026
Written by:
Katten Muchin Rosenman LLP Contact + Follow Jacqueline B. Perel + Follow Michael Rosensaft + Follow
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