US Customs Opens Tariff Refund Portal: What Businesses Need to Know

The system for U.S. businesses to claim refunds for tariffs unlawfully collected under the International Emergency Economic Powers Act (IEEPA) is now open. U.S. Customs and Border Protection (CBP) launched the Consolidated Administration and Processing of Entries (CAPE) system on April 20, 2026, allowing importers of record to seek reimbursements for duties deemed unconstitutional by the U.S. Supreme Court.

The Supreme Court ruled in February that the tariffs imposed by President Trump using his authority under IEEPA were unconstitutional. The court, however, remanded the issue of refunds to the U.S. Court of International Trade (CIT), which subsequently issued orders directing CBP to refund these duties. The CAPE system, integrated within CBP's Automated Commercial Environment (ACE), is designed to streamline this refund process.

Filing for Refunds: The CAPE Process

Applying for refunds through CAPE is described as a relatively straightforward process, though not without potential complexities. Businesses must have an ACE Secure Data Portal account and be set up for Automated Clearing House (ACH) payments, as refunds will be issued electronically and not by check. Companies experiencing difficulties can contact ACE support via email at [email protected] or by phone at 866-530-4172. CBP has established a 24-hour hotline for this purpose, though calling during off-peak hours is advised to minimize wait times.

The CAPE system is being rolled out in phases. Phase I is currently active and includes only unliquidated entries or those liquidated within the past 80 days. Liquidation signifies the final settlement of a customs bill, which typically occurs about 10 months after goods enter the U.S. Importers are encouraged to file claims promptly, especially for tariffs imposed in April 2025, as they are nearing the 80-day window for Phase I eligibility.

To file a claim, the importer of record must submit a Comma-Separated Values (.CSV) file listing the relevant entry numbers through their ACE Portal account. Filers will not use the Automated Broker Interface (ABI) for CAPE declarations. Each CAPE declaration can include up to 9,999 entries, with the option to submit multiple declarations if needed. Upon validation, ACE will update the entry summary lines, and following CBP review, entries will be liquidated or reliquidated. Refunds are generally expected to be issued within 60 to 90 days of the CAPE Declaration's acceptance, unless compliance concerns necessitate further review.

Phase II of the CAPE process will address refunding IEEPA tariffs on entries liquidated more than 80 days ago and those under protest. CBP has not yet announced a start date for Phase II.

Eligibility and Potential Challenges

Only the importer of record is eligible to file for refunds under the current administrative process. This means that if a company used a shipping firm as the importer of record, that firm must file the claim. Major shipping companies like UPS and FedEx have stated they will file for refunds and pass the funds to their clients. Customers who may have indirectly paid duties to their suppliers are not eligible for direct refunds through CAPE.

There are estimated to be 300,000 importers affected, with approximately $170 billion in duties at stake. While the CAPE process aims to simplify recovery, unresolved issues remain, particularly for finally liquidated entries. The U.S. Court of International Trade has noted that refund recovery for these entries is still an open question. CBP may or may not process these through CAPE.

As a best practice, importers with liquidated entries are advised to consider filing protests before the 180-day deadline. This can potentially delay final liquidation and preserve the refund claim. However, CBP has stated that entries with protests filed will not be handled in Phase I of CAPE. Importers may need to withdraw their protests for Phase I processing if the entry was liquidated within 80 days.

Beyond Administrative Claims

While litigation may not be necessary if the CAPE process proves effective for all eligible duties, around 3,000 lawsuits have already been filed. Some importers are pursuing litigation as a precaution or have chosen to sell their refund claims to financial firms offering immediate payment at a discount, which often involves filing suit. The necessity of litigation will likely depend on individual experiences with the CAPE process and CBP's handling of finally liquidated entries.

Commercial discussions and negotiations are currently the primary means for resolving how refunds will be handled between importers, customers, and suppliers, especially when duties were passed on. However, litigation is emerging in some cases, particularly in the business-to-consumer context, with causes of action like unjust enrichment and breach of contract being alleged.

Emerging legal issues include the financing of refund claims, which allows clients to receive substantial recovery more quickly. Duty refunds are also becoming a significant negotiation point in mergers and acquisitions. Furthermore, importers are consulting with advisors regarding the accounting and tax implications of significant duty recoveries.