Importers to the United States need to immediately evaluate potential refund claims now that the U.S. Supreme Court has rule the legal justification for tariffs implemented by the Trump Administration to be unconstitutional. The deadline to file protests is typically 180 days from the date of liquidation, and each passing day may permanently foreclose recovery of duties paid. It is advisable to consult with outside legal counsel while promptly reviewing the liquidation status of your entries and determine whether they remain within the statutory period to preserve your rights.

What Happened

The Court ruled in a 6-3 decision that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the President to impose tariffs, noting the White House would need explicit authorization from Congress. The February 20, 2026 decision invalidates tariffs imposed under national emergency declarations related to drug trafficking and trade deficits.

The case resulted from challenges by some states and importers after President Trump declared national emergencies in 2025 and imposed a variety of tariffs on more than one hundred countries. Those included 25% tariffs on most imports from Canada and Mexico, initial 10% tariffs on Chinese imports (later increased), and minimum “reciprocal” tariffs of 10% on all imports, with higher rates for certain countries. The Administration relied exclusively on IEEPA, which permits the President to “regulate … importation” during national emergencies.

The original challenge was heard by the U.S. Court of International Trade (CIT), and the CIT declared the tariffs invalid. That ruling was affirmed by the U.S. Court of Appeals for the Federal Circuit.

What The Court Found

The Court held that:

1. The U.S. Constitution grants Congress, not the President, the power to impose taxes.
2. Tariffs are taxes on imports.
3. The term “regulate … importation” in IEEPA does not include the authority to impose taxes or tariffs.
4. When the Executive exercises power of vast economic and political significance, there must be clear congressional authorization (the major questions doctrine).

The Court emphasized that in the nearly 50 years since IEEPA’s enactment, no President had used the statute to impose tariffs. Moreover, when Congress has delegated tariff authority in the past, it has done so expressly and with clear limitations.

Accordingly, the Court affirmed the Federal Circuit’s decision invalidating the tariffs.

What This Means for Possible Tariff Refunds

The ruling does not address the mechanism by which companies may seek refunds of tariffs paid. The Court limited its holding to finding that IEEPA did not authorize the measures, without detailing refund procedures or establishing special rules.

In practice, refunds must be pursued under existing administrative procedures, which in certain cases will require filing protests or claims with U.S. Customs and Border Protection (CBP).

Next Steps for Importers

If your company paid tariffs imposed under IEEPA, it is advisable to immediately assess your position and available recovery options. Seeking the guidance of outside counsel should be part of this process. Procopio’s International Tax attorneys in our Washington, D.C. office are ready to review your specific circumstances and advise on the most appropriate next steps.