IEEPA Tariff Refunds for Manufacturing and Industrial Importers

Manufacturers importing raw materials, components, and capital equipment bore a double cost from IEEPA tariffs: the direct duty expense on incoming materials and the competitive disadvantage against domestic competitors who didn’t face the same surcharge. Now that the Supreme Court has ruled those tariffs unconstitutional, the refund opportunity for industrial importers is substantial — but there’s a critical distinction you need to understand before filing a single claim.

The 6-3 ruling in Learning Resources, Inc. v. Trump on February 20, 2026, invalidated all IEEPA tariffs collected between February 4, 2025, and February 24, 2026. The CIT’s March 4 order directed CBP to begin processing refunds. For manufacturers, this ruling is a significant financial event — but the overlap between IEEPA tariffs and Section 232 tariffs on steel and aluminum creates a minefield for the unprepared.

This guide covers the specific HTS codes, the Section 232 exclusion, documentation requirements, and recovery strategies for manufacturing and industrial importers.

The Critical Section 232 Distinction

Before we go any further, this is the single most important thing for manufacturers to understand:

Section 232 tariffs on steel (25%) and aluminum (10%) are NOT covered by the IEEPA ruling. They remain in force and are NOT refundable.

Section 232 tariffs were imposed under a different legal authority — Section 232 of the Trade Expansion Act of 1962 — and were upheld separately by the courts. The Supreme Court’s IEEPA ruling addressed only the tariffs imposed under the International Emergency Economic Powers Act.

This matters enormously for manufacturers because steel and aluminum are foundational manufacturing inputs. If your imports are classified under HTS Chapters 72 (iron and steel), 73 (steel articles), or 76 (aluminum and articles thereof), and those imports are subject to Section 232 tariffs, those duties are not part of your IEEPA refund.

However: If those same imports were also subject to IEEPA tariffs (in addition to Section 232), the IEEPA portion is refundable. And many manufactured goods — machinery, equipment, components — that are made of steel or aluminum but classified under other HTS chapters (84, 85, 87, etc.) may be subject to IEEPA tariffs but NOT Section 232. The classification of the imported article, not its material composition, determines which tariff regime applies.

A steel valve classified under HTS 8481 (taps, cocks, valves) is subject to Chapter 84 duty rates plus IEEPA. The same steel, if imported as a steel bar under HTS 7214, would be subject to Section 232. Same material, different product, different tariff treatment.

Which Manufacturing and Industrial Products Qualify

With the Section 232 carve-out understood, here’s the broad range of manufacturing imports that do qualify for IEEPA refunds.

Key HTS Codes for Manufacturing and Industrial Importers

This is not exhaustive. Essentially, any manufactured input, component, tool, machine, or industrial material from an IEEPA-designated country that’s NOT classified under the Section 232 steel/aluminum headings is eligible.

The Absorption Problem

Here’s something that makes the manufacturing sector’s refund situation particularly interesting: many manufacturers absorbed IEEPA tariffs into their product pricing rather than passing them through to customers.

When you raise your domestic selling price by 20% to cover a 20% tariff, and then that tariff is declared unconstitutional and refunded, you’ve effectively received both the higher price from customers AND the refund from the government. Some manufacturers may face customer pressure to adjust pricing or issue retroactive credits. Others — particularly those in competitive markets where pricing is set by market forces — may keep the refund as a recovery of margin they were forced to sacrifice.

Either way, the refund is yours as the importer of record. How you handle the customer relationship is a business decision.

Estimating Your Manufacturing Refund

Manufacturing imports tend to have high per-entry values, which translates to substantial per-entry IEEPA duties.

For a mid-size manufacturer importing $15 million annually in components and materials from China at an average IEEPA rate of 25%, the 12-month refund exposure is approximately $3.75 million. For companies that also import from Canada and Mexico, add another layer.

Get your free Impact Assessment →

Capital Equipment vs. Recurring Material Imports

Manufacturers’ import portfolios typically fall into two categories with very different refund characteristics:

Recurring material and component imports: These are your regular production inputs — chemicals, plastics, electronic components, sub-assemblies, packaging materials. They generate steady entry flow throughout the year, similar to other industries. The refund on these entries accumulates across many individual entries.

Capital equipment imports: CNC machines, industrial robots, production line equipment, and specialized tooling. These are infrequent but high-value entries. A single CNC machine from China might have a declared value of $500,000 — with a 25% IEEPA tariff, that’s a $125,000 refund on a single entry. Capital equipment entries are easy to overlook because they’re handled separately from your regular material flow, often by a different department or broker.

Don’t forget to include capital equipment entries in your refund analysis. They can represent a disproportionate share of your total claim.

Documentation Requirements for Manufacturers

Manufacturers generally have strong documentation practices driven by quality management systems (ISO 9001, IATF 16949, AS9100). This is an advantage in the refund process.

Required Documentation

From your customs broker:

• ES-003 reports from ACE covering February 2025 - February 2026
• Entry summaries (CBP Form 7501) for all qualifying entries
• Liquidation status per entry
• HTS line-item detail showing 9903.01 or 9903.02 headings
• Separation of Section 232 duties from IEEPA duties on steel/aluminum-content entries

From your internal records:

• Purchase orders for imported materials and equipment
• Commercial invoices from foreign suppliers
• Bills of lading and shipping documentation
• Receiving records (material receipt and inspection)
• Proof of duty payments (broker invoices, bank records)

Manufacturing-specific documentation:

• Bills of material (BOMs) linking imported components to finished products — useful for validating the scope of your import exposure
• Supplier qualification records — confirming country of origin for each supplier
• Any Section 232 exclusion applications or approvals — these help separate your 232-subject entries from your IEEPA-subject entries

The Section 232 Separation Challenge

This is the most common documentation pitfall for manufacturers. Your entries may include both Section 232 steel/aluminum and IEEPA-covered manufactured goods, sometimes from the same supplier or even on the same entry.

Example: You import a hydraulic assembly from China. The assembly includes a steel housing (potentially Section 232 if imported separately) and hydraulic components (Chapter 84, subject to IEEPA). If the complete assembly is classified under HTS 8412 (hydraulic motors and actuators), it’s subject to Chapter 84 duty rates plus IEEPA — not Section 232. Your refund covers the IEEPA tariff on the entire assembly.

But if you import the steel housing separately under HTS 7326 (other articles of iron or steel), that entry may be subject to Section 232 instead of (or in addition to) IEEPA. The refund analysis needs to be done at the HTS line-item level, not at the product or supplier level.

Your broker’s data will show which tariff headings were applied to each line. Don’t aggregate — disaggregate.

How Manufacturers Who Absorbed Tariffs Should Think About Refunds

Many manufacturers absorbed IEEPA tariffs rather than losing customers to competitors with domestic sourcing. This created real margin compression over the 12-month period. The refund now presents a strategic capital event.

The Windfall Question

If you absorbed the tariff cost and maintained your selling price, the refund is pure margin recovery. If you raised prices to pass through the tariff, the refund may trigger customer expectations for price adjustments or credits. The CFO guide to IEEPA recovery provides a framework for thinking through this strategically.

Reinvestment Opportunities

For manufacturers, the refund capital can be deployed into:

• Automation and equipment upgrades — the tariff period may have delayed planned investments
• Inventory rebuilding — if you reduced safety stock to manage cash during the tariff period
• Supply chain diversification — funding the transition to alternative sources that reduces future tariff risk
• Debt reduction — if you financed tariff payments through working capital facilities or lines of credit

The timing of capital deployment matters. Waiting 18-36 months for CAPE processing means waiting 18-36 months to make these investments. The cost of waiting analysis helps quantify what that delay means for your business.

Which Recovery Path Works Best for Manufacturers

The four recovery paths apply to manufacturers, with specific considerations for the industry.

Recommended Strategy for Manufacturing Importers

Step 1 — Separate 232 from IEEPA. Before doing anything else, work with your broker to identify which entries are subject to Section 232 and which are subject to IEEPA. Any entry with only Section 232 duties should be excluded from your IEEPA refund analysis. This step prevents filing claims that will be rejected.

Step 2 — Identify capital equipment entries. Pull these out separately because they’re high-value, easy to process, and often overlooked. A single capital equipment entry can be worth more than dozens of recurring material entries combined.

Step 3 — Triage remaining entries by liquidation status. Sort into unliquidated (PSC), within 180 days (protest), and past 180 days (CIT). File PSCs and protests according to the 180-day protest window timeline.

Step 4 — File protests immediately on time-sensitive entries. For entries liquidated in early 2026, the protest window is closing. Don’t wait for CAPE to handle these — file protests now to preserve your rights.

Step 5 — Evaluate immediate capital for large claims. Manufacturers with refund claims exceeding $2 million and pending capital investment decisions should seriously evaluate the immediate capital path. The government filing vs. immediate capital comparison provides the analytical framework. If you have a $5 million equipment upgrade on hold pending capital availability, converting your refund claim into immediate payment may be the right move even at a discount.

The Reshoring and Nearshoring Angle

Many manufacturers used the IEEPA tariff period to accelerate reshoring or nearshoring initiatives — moving production from China to Mexico, Vietnam, or domestically. The irony is that the tariffs driving those moves have now been invalidated.

The refund doesn’t undo your reshoring investments, but it can help fund them. If you spent capital diversifying your supply chain during the tariff period, the IEEPA refund can reimburse part of that cost.

It also raises a strategic question: with IEEPA tariffs now unconstitutional, should you shift sourcing back to China? Most manufacturers we work with are maintaining their diversified supply chains as insurance against future trade policy changes. The refund simply makes that transition less financially painful.

Manufacturing and Industrial FAQ

My company imports steel and aluminum. Am I out of luck?

Not necessarily. If your steel and aluminum imports are classified under HTS Chapters 72, 73, or 76 and are subject to Section 232 tariffs, those duties are not refundable under the IEEPA ruling. However, if those same imports were also subject to IEEPA tariffs (a possibility depending on the specific executive orders and timeline), the IEEPA portion may be refundable. And if you import manufactured goods that contain steel or aluminum but are classified under other chapters (84, 85, 87, etc.), those are IEEPA-subject regardless of material content. An Impact Assessment will separate these layers for you.

We have a Foreign Trade Zone. Do FTZ entries qualify?

Goods admitted to an FTZ are not “entered” for customs purposes until they’re withdrawn for consumption. If you withdrew goods from your FTZ for consumption during the IEEPA period and IEEPA tariffs were assessed at that point, those entries qualify. Goods that remained in the FTZ or were re-exported without entering U.S. commerce do not qualify because no IEEPA duties were paid.

Our company manufactures in Mexico and imports finished goods to the U.S. Do we qualify?

If your finished goods from Mexico were subject to IEEPA tariffs (under the fentanyl-related executive orders) and did not qualify for USMCA preferential treatment, yes. Many manufactured goods from Mexico were exempt under USMCA — but the exemption status changed multiple times during the IEEPA period. Check your ES-003 reports for the actual presence of 9903 headings on your entries.

We import components from multiple countries and assemble them here. How do we calculate the refund?

Each component entry is evaluated separately based on its own HTS code, country of origin, and IEEPA tariff applicability. Your total refund is the sum of IEEPA duties paid across all qualifying component entries. The fact that you assemble them into a finished product domestically doesn’t change the refund calculation — it’s based on the import entry, not the downstream use. The 7 steps to file your IEEPA refund walks through the process for multi-component portfolios.

Can we claim interest on top of the IEEPA refund?

CBP pays interest on refunds under 19 U.S.C. Section 1505(c). The interest rate is set quarterly by the IRS and has historically been in the 3-5% range. While interest helps, it’s typically below a manufacturer’s cost of capital. The calculate your IEEPA tariff refund amount guide includes interest calculations.

The Bottom Line for Manufacturing and Industrial Importers

Manufacturing importers have some of the most complex IEEPA refund situations — the Section 232 overlap, the capital equipment vs. recurring materials distinction, the absorption-vs-pass-through pricing question, and the reshoring cost recovery angle all require careful analysis.

But the payoff is equally substantial. A manufacturer with $15-20 million in annual imports from IEEPA-designated countries is likely looking at a multi-million dollar refund. That’s capital that can fund equipment upgrades, inventory rebuilding, debt reduction, or supply chain diversification.

The first step is a clean separation of your Section 232 entries from your IEEPA entries. Everything else builds from there.