SCOTUS strikes down IEEPA tariffs, Section 122 replaces them within hours, and $175 billion in refunds is sitting in legal limbo.

SCOTUS Shuts Down IEEPA

In a 6-3 ruling, the Supreme Court decided that the President does not have the authority to unilaterally impose tariffs under the International Emergency Economic Powers Act. The case is Learning Resources, Inc. v. Trump and it is a huge deal.

The core of why these tariffs failed comes down to one uncomfortable truth for the administration. The "emergency" cited as the basis for the tariffs was described in the executive order itself as "persistent annual U.S. goods trade deficits" and "structural imbalances in the global trading system." The Brennan Center, filing in support of the challengers, put it plainly: a persistent and structural problem is the very definition of a normal, ongoing problem. Emergencies, by definition, are sudden and unforeseen. A trade deficit that has existed for decades is neither.

There is also a simpler legal problem. IEEPA lists the specific powers the president may exercise during a national emergency. Imposing tariffs is not on that list. No president had used IEEPA to impose tariffs in its nearly 50-year history before Trump. And Congress had already passed a separate law, Section 122 of the Trade Act of 1974, specifically authorizing tariffs in response to trade imbalances, but with a 15% cap and a 150-day limit. Using IEEPA to bypass those constraints would render those congressional limits meaningless.

The Court agreed. Here's what it means in plain English.

Up to $175 billion in IEEPA tariffs could be eligible for refunds. The ruling opens the door, but it does not hand you a check. You have to go get it.

Here Is Exactly How You Go Get It

There are two paths depending on where your entries sit right now.

If your entries have not yet liquidated, you file a Post Summary Correction. A PSC lets you amend the entry before CBP finalizes it, which means you can remove the IEEPA tariff before it becomes locked in. This is the faster and cleaner of the two options. If your broker has not already flagged your unliquidated entries, that conversation needs to happen TODAY.

If your entries have already liquidated, you file a protest. Importers generally have 180 days from the date of liquidation to file. A protest is a formal legal challenge to CBP's treatment of your entry. You are telling CBP the tariff was unlawfully collected and you want it back. The 180-day clock is not flexible. If you miss it, the opportunity is gone.

The practical reality is that most importers have a mix of both. Some entries are still open. Some have already closed. Here is exactly where the deadlines sit:

• 300 days from entry date - Last day to file a PSC (or 15 days before scheduled liquidation, whichever is earlier)

• 314 days from entry date - Typical liquidation date — once this happens, protest is your avenue

• 180 days from liquidation - Last day to file a protest with CBP

You need someone to go through your entry history, identify which bucket each one falls into, and move quickly on both tracks.

Now Here Is the Part Nobody Is Talking About Enough

The Supreme Court ruling did not establish how refunds will actually work. The majority opinion said nothing about whether the government is required to return the money, what the mechanism looks like, or what the timeline is. Even the dissent acknowledged the process is likely to be a mess. CBP is now sitting on roughly $129 billion in collected IEEPA duties with no formal roadmap for returning it.

Because of that uncertainty, large importers are not waiting around. They have been filing suit directly at the Court of International Trade to protect their refund rights, rather than relying on the protest process alone. More than 1,000 companies had already filed protective actions before the ruling even came down. That number is growing fast.

To make it more complicated, the Trump administration has signaled it intends to fight the refunds in court. The president's position is that even if IEEPA was an invalid basis for the tariffs, the government is not obligated to give the money back automatically. That fight is going to play out over months or possibly years.

What does this mean for you? File your PSCs on unliquidated entries now. File protests on liquidated entries before the 180-day window closes. And if your IEEPA exposure is significant, talk to trade counsel about whether a CIT protective action makes sense for your situation. Do not assume a refund is coming automatically. If CBP does issue them, they will come via ACH transfer, but right now there is no confirmed process at all.

Section 122. What It Is and Why Postal Shippers Should Actually Pay Attention

Section 122 of the Trade Act of 1974 gives the President authority to impose a temporary tariff surcharge to address a balance of payments deficit. The current rate is 10% universally applied across imports. It is cleaner and broader than IEEPA.

Here is something most people have not caught yet. For postal shipments, Section 122 is actually simpler than what came before. Under the old IEEPA postal rules, low-value shipments were getting hit with the IEEPA tariff rate tied to the country of origin, which meant a different rate for every country in the world depending on where the goods came from. Under Section 122, postal shipments fall under the same 10% universal rate as everything else. One rate. Predictable math. If you are a merchant or logistics operator moving goods through postal channels, the regime just got easier to plan around even if the cost itself is not gone.

Two things to know about Section 122. It has a statutory 15% cap, which is why Trump has already floated moving from 10% to 15%. And it has a 150-day duration limit unless Congress acts to extend it. Watch that clock.

More Section 301 Investigations Are Coming

USTR Jamieson Greer announced the administration is launching new Section 301 investigations against most major trading partners, including Brazil and China, covering areas like pharmaceutical pricing, digital services, and what the administration is calling unfair trade practices more broadly.

Here is why this matters more than people are giving it credit for right now. Section 301 is the mechanism that produced the original China tariffs in 2018 and 2019, and those tariffs are still in place today. Unlike IEEPA, Section 301 requires an actual process: formal investigations, public hearings, comment periods, findings of fact. That process takes months. But at the end of that road, the president has broad authority to impose tariffs that are legally defensible, congressionally grounded, and much harder to challenge in court than IEEPA ever was.

This is not a threat. It is a roadmap. The administration just lost its fastest tool for imposing tariffs and within hours it announced it was building new ones the right way. Treasury Secretary Bessent said tariff revenue in 2026 will be virtually unchanged. Section 301 is a big part of how they intend to deliver on that. Watch this story closely over the next several months because the investigations being launched today are the tariffs you will be paying in 2027.

De Minimis Is Still Gone

Some people thought the SCOTUS ruling might resurrect the $800 de minimis exemption. It did not. Trump signed a separate executive order on February 20 explicitly reaffirming the de minimis suspension for all countries. Every shipment, regardless of value, is still subject to duties. This is not changing anytime soon.

The reasoning matters here. The de minimis suspension was not struck down by the court because it was never part of the Learning Resources case. The SCOTUS ruling was specifically about IEEPA as a basis for tariffs. De minimis was suspended through a separate executive action and the administration moved immediately to firewall it from the ruling. The message was deliberate. The era of duty-free low-value shipments is over and the administration intends to keep it that way regardless of what happens in the courts.

If you are a merchant, a logistics operator, or a brand doing any volume of direct-to-consumer cross-border shipping, your cost structure has permanently changed. Build that into your pricing now if you have not already.

U.S. and Indonesia Finalize Trade Deal

On February 19, President Trump and Indonesian President Prabowo Subianto signed a landmark reciprocal trade agreement. Indonesia will eliminate tariffs on over 99% of U.S. goods. In return, the U.S. keeps a 19% tariff on most Indonesian imports. Indonesia is the world's fourth most populous country and one of the fastest growing markets in Southeast Asia. This is a big deal for U.S. agriculture, manufacturing, and digital exports.

But zoom out for a second. This is the second major bilateral deal signed in a week, following Taiwan on February 18. The administration is moving fast and the framework is becoming clear. Trading partners that cooperate get a negotiated rate. Trading partners that do not face whatever authority the administration has available, which right now is Section 122 at 10% and climbing. Indonesia at 19% and Taiwan at 15% are better than the IEEPA reciprocal rates those countries were facing, and both governments clearly calculated that a deal was better than the alternative.

For importers sourcing from these countries, the key question is whether your goods qualify for preferential treatment under the new agreements and whether your classifications and country of origin documentation are clean enough to support that claim. If you are not sure, that is worth checking now before CBP starts asking.

Trade Deficit Hits Record Highs

The trade deficit continues to soar as importers front-loaded shipments ahead of tariff uncertainty. The goods trade deficit is sitting at roughly $1.2 trillion. This is the exact number the administration keeps pointing to when justifying aggressive trade action.

Here is the irony that nobody in Washington wants to acknowledge. The front-loading behavior that drove the deficit to record highs was caused by the tariff policy itself. Importers saw the uncertainty coming and pulled shipments forward to beat the deadlines, which inflated import volumes and pushed the deficit higher than it would have been otherwise. The administration then points to that number as evidence that more tariffs are necessary, which will likely trigger another round of front-loading, which will push the deficit higher again.

For importers, the practical implication is straightforward. The trade deficit number is a political weapon right now and the administration will keep using it to justify the next wave of trade action. Whether that comes through Section 122, Section 301, Section 232, or something else entirely, the direction is clear. Expect it to come up at every press briefing, every congressional hearing, and every trade negotiation for the rest of this year.

What Does All of This Mean For Your Business?

The tariff environment is not going back to where it was. IEEPA is gone but the trade war is not. You need a partner who understands what just changed, what stayed the same, and where your biggest compliance exposure sits. That is exactly what we do at Importal.

If you have questions about your refund eligibility, your PSC and protest filing windows, or how to stay ahead of the next wave of Section 301 investigations, let's talk!