What The Feb. 20, 2026, Decision In Learning Resources, Inc. v. Trump Means For Your Business
On Feb. 20, 2026, the U.S. Supreme Court delivered a clear and consequential ruling: the International Emergency Economic Powers Act (IEEPA) does not give the President authority to impose tariffs. The Court held that Congress had not delegated its tariff taxing power when it passed IEEPA, making any IEEPA-based duties unlawful. Implementation was handed to the U.S. Court of International Trade (CIT) and U.S. Customs and Border Protection (CBP).
For hundreds of thousands of U.S. importers, this decision has significant practical implications; it could mean refunds of hundreds of billions of dollars in duties already paid. Here’s what the ruling changes and exactly what you should do next.
Download GBQ’s IEEPA Tariff Refund Cheat Sheet
Immediate Impact Of The Supreme Court Decision
Tariff collection under IEEPA stopped on Feb. 24, 2026. Importers who paid these duties are now potentially eligible for full refunds, plus interest. The scope is broad: every importer of record who paid IEEPA duties, not just those involved in the lawsuit, stands to benefit, subject to any future government appeal.
CIT Orders: How Refunds Must Proceed
Between March 4 and 6, 2026, the CIT issued detailed directives outlining the refund process. The guidance is importer-friendly and intentionally broad.
Refund Eligibility
All importers of record who paid IEEPA duties qualify. The ruling applies nationwide, regardless of whether your company joined the original litigation. However, there is a disagreement between the CIT and the government over this point, so the best practice to obtain a refund is to take action.
Treatment of Import Entries
The key question for every entry is whether it has been “liquidated,” the official CBP process that finalizes the exact duties owed (typically completed within 314 days of entry). Here’s how each type is handled:
- Unliquidated entries: CBP must finalize them without IEEPA duties.
- Liquidated but not-yet-final entries: CBP must reliquidate them without the tariffs.
- Fully final liquidations: These may require formal protests, administrative remedies, or additional court proceedings (procedures are still being developed).
CBP has acknowledged that its current systems cannot handle the volume immediately, and some parts of the CIT order have been temporarily paused pending appeals. Still, the direction from the court is unmistakable: refunds are coming.
CBP’s New Automated Refund System: What We Know Today
CBP is rapidly building new functionality inside the Automated Commercial Environment (ACE), the same portal importers already use for filings. The planned process is straightforward:
- Importers submit an ACE declaration listing entries that include IEEPA duties.
- ACE automatically validates each entry, recalculates duties without the tariffs, adds interest, and sends the corrected amounts to CBP for review.
- CBP liquidates or reliquidates the entries.
- Once certified, the U.S. Treasury issues refunds electronically via ACH.
Only about 6% of importers currently have active ACH refund authorization in place. CBP is strongly encouraging everyone else to set this up immediately; refunds will not be issued by check.
A bulk-calculation option for larger importers is also under consideration to speed up processing. The new ACE refund tools are targeted to go live approximately 45 days after early March filings (mid-April 2026), subject to final court approval.
Your Expected Refund Pathway At A Glance
| Entry Type | How the Refund Will Be Handled | Importer Action Needed |
| Unliquidated | Liquidated without IEEPA duties; refund flows automatically once ACE updates. | Minimal, monitor ACE. |
| Liquidated but not final | Must be reliquidated without IEEPA duties. | Track and confirm issuance. |
| Final liquidations | Requires protests, litigation, or forthcoming CIT/CBP procedures. | Prepare protests now. |
| Payment method | ACH electronic transfer only. | Set up ACH authorization immediately. |
| Timeline | ACE automation expected mid-April 2026. | Act now to be ready. |
What Your Company Should Do Right Now: Practical Checklist
Don’t wait for the ACE system to launch. Taking these steps today will position you to receive refunds as quickly as possible:
- Update or create your ACE account and enable ACH refund authorization – This is the single most important action. Without it, refunds cannot be deposited.
- Map every entry and compile duty-payment records – Gather entry numbers, dates, and IEEPA duty amounts now so you’re ready to file declarations the moment the new ACE functionality is live. Prioritize liquidated-but-not-final entries.
- Preserve your rights on fully liquidated entries – Work with counsel to prepare protests or other protective filings before deadlines expire.
- If you are a downstream buyer, distributor, or retailer – Review your contracts with importers for duty-sharing, price-adjustment, or refund-pass-through clauses so you can capture any savings that flow through the supply chain.
Next Steps: Secure Your Refund and Stay Ahead
The Supreme Court’s decision marks a significant shift in U.S. trade policy and creates a rare opportunity for importers to recover substantial sums. While the process is still evolving, acting early will make the difference between receiving your refund quickly and waiting months or even years longer.
Download GBQ’s free IEEPA Refund Cheat Sheet for a one-page timeline and ACE filing checklist. Or reach out directly to your GBQ advisor for personalized guidance, entry mapping support, and understand what to expect as you claim your refund.
At GBQ, we’re here to help you claim the money that your business is entitled to. Contact us today for additional guidance and insight.
By Mark Silvaggio, JD, CPA, Director, Tax & Advisory
