What the Supreme Court’s Tariff Ruling Means for Importers, Refund Claims, and Supply Chains

Summary: The U.S. Supreme Court ruled that the president lacks authority under the IEEPA to impose tariffs, casting doubt on previously assessed IEEPA-based tariffs and raising the possibility of refund claims for importers. While the refund process remains uncertain and may depend on further court and agency guidance, importers should begin preparing for potential next steps.

On Feb. 20, 2026, the U.S. Supreme Court held that the president does not have authority under the International Emergency Economic Powers Act (IEEPA) to impose tariffs. The decision calls into question tariffs that were assessed and collected under IEEPA-based executive orders.

Now the headline question for importers is simple: Can we get a refund of IEEPA-based tariffs? At this early stage, the answer is uncertain. The Supreme Court did not spell out whether refunds will be available or how any repayment process would work.

IEEPA Tarriff Decision: Key Takeaways

• The ruling may open the door for some importers to pursue refunds of IEEPA-based tariffs, but the path forward is not yet defined.
• The Supreme Court did not address refunds, so next steps may depend on further court proceedings and guidance from CBP and Treasury.
• Do not assume a near-term cash inflow. Start gathering documentation and engage experienced customs/trade counsel to evaluate options and deadlines.

Why the Court Ruled IEEPA Does Not Authorize Tariff Increases

In its Feb. 20 opinion, the Supreme Court held that IEEPA does not authorize the president to impose tariffs. In other words, the emergency powers to “regulate” imports under IEEPA do not extend to creating or increasing tariff rates without clear congressional authorization. The decision is focused on tariffs imposed under IEEPA. Tariffs imposed under other statutes or authorities may not be affected.

Who Ultimately Bears the Economic Burden of Invalidated Tariffs

If your business was the importer of record on imports subject to IEEPA-based tariffs, you may have a potential claim if a refund mechanism ultimately becomes available. Even if you were not the importer of record, the ruling may affect pricing, supply chain negotiations, and contract terms as parties revisit who bore the economic burden of these tariffs.

IEEPA Tariff Refunds: What We Know About the Potential Claims Process

The Supreme Court did not provide instructions on refunds. Early reporting suggests the refund question may be left to additional proceedings in the lower courts and/or the U.S. Court of International Trade, with administration work likely involving U.S. Customs and Border Protection (CBP) and the Department of the Treasury. Any reimbursement process could take months – and potentially longer.

Because tariffs are collected at the border, any refunds (if available) would generally be expected to flow to the importing party that can substantiate payment, not necessarily to downstream customers who experienced higher prices.

What’s Next?

This development is very recent, and the refund landscape is evolving quickly. KSM professionals are closely monitoring this evolution and will share updates as credible guidance emerges. In the meantime, we recommend engaging with experienced customs/trade counsel and coordinating with your customs broker to assess options, procedural requirements, and deadlines that may need to be protected.

If you have questions, connect with your KSM advisor or fill out the form below.