Road Map for IEEPA Tariff Refunds

The United States Court of International Trade (CIT) is set to decide how refunds will be issued for approximately $166 billion in IEEPA-based tariffs following the Supreme Court’s Learning Resources decision. This a massive task, but not one without precedent. In this alert, we look back to an earlier case where the CIT found itself overseeing a large claims process for clues as to how it will likely manage what is sure to be a tsunami of IEEPA refund claims. 

In United States v. U.S. Shoe Corp., the CIT ordered a multi-phase claims resolution process following the Supreme Court’s determination in U.S. Shoe Corp. v. United States that the Harbor Maintenance Tax (HMT) on exports was unconstitutional. The court imposed a process under which claimants submitted standardized forms to Customs, which then verified payments through its database, issued certifications, and processed stipulated judgments for refund — with disputed claims handled through additional documentation review and, if necessary, judicial resolution. While the scale of the IEEPA refunds far exceeds the HMT refunds, U.S. Shoe’s core principles — centralized judicial oversight, structured administrative procedures, and close coordination with Customs — offer a template that the CIT will likely adapt to meet the unprecedented demands of the IEEPA tariffs.

Phase 1: Initial Review of All Claims

In Phase 1 of the U.S. Shoe process, each claimant was required to complete a “claim form” and submit that completed form to Customs. Once Customs received a claim form, it would search its computer database to identify all HMT payments made by the claimant listed on the claim form. Customs then completed a report calculating the refund amount owed to a claimant and returned that report, along with a certification of its accuracy, to the claimant. 

The claimant then reviewed Customs’ calculation against its own internal records. If the claimant was satisfied, it would countersign the report and certification, complete and sign a judgment form (with the signed report and certification attached), and return the judgment form to the Justice Department for filing with the court within 11 days of receipt. The court further provided that the judgment would list all complaints related to the refunds without need for an order of consolidation. 

The CIT also prescribed a minimum pace for Customs to work through claims — the order required Customs to build up its response speed to process no fewer than 500 refund claims per month. Customs was also required to provide the CIT with a monthly refund status report. 

Phase 2: Disputed Claims

Claimants could dispute the refund amount calculated by Customs in Phase 2. Claimants with disputes would supply Customs with documentation supporting their claims for different refund amounts. Customs would then recalculate the refund amount and would issue a revised report and certification within 60 days. If the claimant was satisfied with Customs’ revised refund calculation, it would proceed in accordance with Phase 1. If the claimant disagreed with Customs’ revised refund calculation, it would proceed to Phase 3. 

Phase 3: Judicial Review

If the disputes could not be resolved through Customs’ administrative review, claimants could request judicial resolution by filing a proposed scheduling order with the CIT. The standard substantive and procedural law applicable to any refund dispute then applied to HMT disputes that emerged out of the streamlined administrative process. 

The IEEPA Process

The U.S. Shoe mechanism was ultimately successful, but a look at the numbers makes clear Customs will need a more robust process this time around. With the HMT refunds, it took approximately two and a half years to pay out $730 million to as many as 100,000 claimants, according to a recent Reuters article. It was not until 2005 — seven years after the Supreme Court’s 1998 decision — that the government confirmed that all HMT claims had been paid. 

According to a Declaration Customs filed with the CIT, the IEEPA tariffs involve over 53 million entries totaling approximately $166 billion in duties paid by more than 330,000 importers. To tackle the massive number of potential claims, Customs has proposed modifying its Automated Commercial Environment (ACE) system to allow importers to file declarations listing entries on which IEEPA duties were paid after which ACE would automatically validate entries, recalculate duties owed without IEEPA tariffs (with applicable interest), aggregate refunds by importer and liquidation date, and certify the refunds for electronic disbursement by the Treasury Department. Customs anticipates this automated functionality will be ready for use within 45 days and will save over 4 million hours of manual processing while minimizing errors. But it does not predict how long it will take.

The Customs proposal also does not incorporate several key elements of U.S. Shoe that we expect CIT to implement — most notably, a mechanism for handling disputed claims administratively, a process for judicial review, and a minimum pace requirement for processing claims. The court has ordered Customs to file a status report on March 12, 2026. We will have to wait for that submission for better insight on next steps, but we expect an automated process to be in place by April, for the court to implement some form of expedited review for challenges that arise from the process, and for any challenges to take months if not years to resolve, particularly for the country’s largest importers.

Andrew Hersey recently completed a clerkship in the Court of International Trade for Judge Richard K. Eaton.