IEEPA reciprocal tariffs and drawback: what's excluded, and why we say so

As of June 6, 2026, the IEEPA reciprocal-tariff story is no longer just a tariff-rate story. It is a collection, refund, liquidation, and drawback-estimation story.

That matters because a drawback estimate is only useful if it separates three things: duties that are eligible for drawback, duties that are excluded by law or CBP treatment, and duties that may be recoverable through a different path. We do not collapse those buckets into one number.

What the IEEPA reciprocal tariffs were

The reciprocal tariffs were imposed by Executive Order 14257, published at 90 Fed. Reg. 15041. The order invoked IEEPA, the National Emergencies Act, and other authorities, and started with an additional 10% ad valorem duty on covered imports, with higher country-specific rates identified in the annexes.

CBP’s April 8, 2025 implementation message required filers to report a Chapter 99 secondary classification for reciprocal-tariff treatment or an exception. It also required the additional duty to be associated with the correct HTSUS line instead of being blended into another duty amount.

The legal posture changed in 2026

The Supreme Court decided Learning Resources, Inc. v. Trump on February 20, 2026. The Court held that IEEPA did not authorize the President to impose the challenged tariffs. CBP then issued CSMS #67834313, stating that IEEPA duties under EO 14257 and related IEEPA tariff actions would no longer be in effect or collected for goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:00 a.m. Eastern time on February 24, 2026.

CBP also said that all HTSUS numbers applicable to the IEEPA tariffs would be inactive in ACE as of February 24, 2026, and that the termination affected IEEPA duties only—not Section 232 or Section 301 duties.

Our current drawback read: generally exclude IEEPA reciprocal amounts from the drawback estimate

Here is the careful version: CBP’s original April 2025 reciprocal-tariff guidance said, expressly, that drawback is available with respect to the additional duties imposed by EO 14257. We do not ignore that sentence.

But the current operating environment is different. After the Supreme Court decision and follow-on CIT refund orders, CBP created the CAPE process to remove IEEPA Chapter 99 lines and recalculate entries as if IEEPA duties were never owed. In that process, CBP’s April 13, 2026 guidance says entries associated with a drawback entry and entry type 47 drawback entries are not accepted in CAPE Phase 1. It also tells importers and brokers to submit a CAPE Declaration for IEEPA refunds before filing a drawback claim.

That is why our standard estimate treatment is conservative: we generally exclude historical IEEPA reciprocal amounts from the ordinary drawback recovery number and itemize them separately. The reason is not that the April 2025 sentence never existed. The reason is that the more current refund path is entry correction, liquidation, or reliquidation without IEEPA duties—not a routine 99% drawback recovery layered on top of those same amounts.

If a duty may be refunded outside drawback, it should not be quietly counted inside a drawback estimate.

Why Section 301 is different

Section 301 duties are a useful contrast. CBP has long stated in its trade-remedies drawback guidance that Section 301 duties are eligible for duty drawback. The statutory authority is also different: Section 301 is in Title 19 and expressly authorizes USTR action, including duties, when the statutory conditions are met.

So, where the import and export facts support a valid manufacturing, unused-merchandise, or other drawback claim, Section 301 duty is typically modeled as potentially eligible. It still has to pass the normal drawback tests: correct claimant, designated import, export or destruction evidence, timing, substitution rules if used, and line-level duty attribution.

Why AD/CVD is different, too

Antidumping and countervailing duties go in the opposite bucket. The drawback regulations are direct: drawback is not allowable on AD/CVD imposed on merchandise entered, or withdrawn from warehouse, for consumption. That rule is reflected in 19 CFR § 190.3(b), which points to 19 USC § 1677h.

How a defensible estimate should show the math

The mistake is to drop excluded duty silently. That makes the refund look smaller without explaining why, or worse, lets a user assume the software missed a duty line. A defensible report should show the paid duty, identify whether it is included or excluded, and state the reason at the line level.

For IEEPA reciprocal duties, our report logic should name the Chapter 99 tariff line, show the paid amount, and mark it as excluded from the standard drawback estimate with a reason such as: “IEEPA reciprocal amount tracked separately; subject to current CBP CAPE/refund and liquidation treatment; not counted in ordinary drawback estimate.”

What we would show on a report

• Eligible ordinary duty: included in the drawback estimate if the claim facts support it.
• Section 301 duty: generally included as potentially drawback-eligible, subject to the normal drawback rules.
• IEEPA reciprocal duty: shown as paid or reported, but generally excluded from the standard drawback estimate and tracked for separate refund/liquidation handling.
• AD/CVD: shown as excluded, with the regulatory reason.
• Exceptions and non-duty amounts: shown separately so the user can see what was paid, what was not paid, and what cannot be claimed.

Why naming exclusions is better than hiding them

Trade teams need to reconcile estimates to entry summaries, ACE reports, broker statements, and finance accruals. If the report simply omits IEEPA reciprocal duty, the estimate may be mathematically conservative but operationally weak. The user is left asking whether the duty was missed.

Itemization gives the reviewer a trail: the duty was detected, classified, and excluded for a stated reason. That is especially important when law and guidance are moving quickly, as they have for IEEPA tariffs since April 2025.

Practical note: this article is for trade-compliance planning, not legal advice. IEEPA, Section 122, Section 301, Section 232, AD/CVD, CAPE, protests, PSCs, and liquidation status can interact in ways that change the right recovery path for a specific entry. Validate the entry population and timing before filing.

This article is for general information and is not legal or tax advice. Drawback eligibility depends on your specific facts, and final refunds are determined by CBP at liquidation. Consult a licensed customs broker or attorney for your situation.