Trade experts predict it could take at least 2 to 5 years for importers to receive their IEEPA tariff refunds due to both the long-standing rules that are in effect and the Administration’s adversarial stance to issuing tariff refunds.
The administration can make appeals, request Stays from the U.S. Court of International Trade, Customs could request a case-by-case eligibility review and there could be delays in the system upgrades that Customs and Border Protection are working on. Financial institutions are purchasing these tariff claims at a discount. The current Buy Rates are now up to 85% of the refund amount. Rates are based on claim size and credit quality as tariff refund claims are not assignable. Importers with IEEPA tariff refund claims starting at $350,000 are eligible and there is no maximum limit. AES has monetized $20 million in refund claims since its involvement in brokering IEEPA tariff refund claims commenced 5 months ago. Clients include those in the food, seasonal decoration, apparel and home goods industries. Prior to the Supreme Court’s ruling on February 20, 2026 IEEPA claims were trading at an average of only 22%. After the ruling against the Administration Buy Rates increased to 40%-50 % and subsequent to some positive rulings on March 4 and 6th by the Court of International Trade (“CIT”) and other encouraging news stories, Buy Rates have now increased to up to 85 %. Importers were initially taking a wait and see approach after the recent rulings by CIT as there was initially hope they might see refunds in a manner of months. With the significant increase in Buy Rates and negativity regarding timing in the media, importers are now coming off the sidelines and exploring the potential sale of their IEEPA tariff refund claims. The Funds AES works with can purchase claims within approximately 3 to 5 weeks depending on the quality of documentation assembled by the importer. For a detailed discussion of how these two options work see below. How the Process of Selling an IEEPA Tariff Claim Works Model is: As an example, Company X has paid ($10 Million) in tariffs since April 7, 2025Company X wants to de-risk prior to determination and finalization of the IEEPA tariff Refund Process. Company X sells (50%, 100%, or some other percentage) of its tariff ‘claim’ to Buyer A in the form of a participation. The Trade is nonrecourse to Company X as to the outcome of the Refund Process; but recourse to Company X only if the amount / validity of the claim is proven to be false, or too high. Process for Selling IEEPA Tariff Claims: As an example, Company X has paid $10 million in IEEPA Tariffs. Company X agrees to “sell” its tariff claim to Buyer for 85% of the claim amount, i.e. $8.5 million. Buyer sends Seller a Confirm, and then ultimately a Participation Agreement which will govern the transaction. IMPORTANT – Company X retains its status as the “Plaintiff” / “Claimant” since these tariff claims are not transferable. Buyer might ask Company X to commence litigation for the return of the IEEPA tariffs paid. The rationale for this is that it is possible that only those parties who have commenced actual litigation are entitled to refunds. Thus, Company X will need to commence litigation in order to receive their refund.Buyer will continue to monitor the situation and inform Company X of developments.If and when the refund is received on the claim, Company X will receive the refund and forward to the Buyer. Using an IEEPA Tariff Claim as Collateral for a Loan In lieu of selling an IEEPA Tariff Claim at a discount, it is possible to use this claim as collateral for a term loan. This term loan would be on a “recourse: basis to the borrower. The potential loan amount could be up to approximately 50% to 60% of the total IEEPA claim amount. However, the claim must exceed $20 million to qualify for a loan. The interest rate would be in the low to mid-teens. Important Points Regarding the Sale of a Tariff Claim: Company X (as seller of the Claim) must be a financially healthy enough counterparty for Buyer A to enter into what could be a 2-to-5-year process of obtaining the refund. Legal fees are split going forward based on risk percentage. If Company X sells 100% today, Buyer A will pay 100% of legal costs today. Buyers are currently paying up to 85% to companies seeking to sell their IEEPA tariff claims. However, this is an evolving market and these percentages can either increase or decrease depending on the markets’ reaction to the Trump Administration’s expected obstructionism and the unresolved Court of International Trade’s procedural issues. Prior to the Supreme Court decision, buyers were purchasing tariff claims at an average of 22% due to the high risks involved. We will be monitoring on a daily basis the rates at which Buyers are purchasing IEEPA claims and we will update our website accordingly. Feel free to email us to ascertain what the rate is on any particular day. There would likely be an administrative process instituted such that companies that have paid these IEEPA tariffs will need to file special claims and wait to get refunded by the government. The process of receiving the refund payment from the government could take up to 2 to 5 years according to trade experts. |
Contact Factoring Specialist, Chris Lehnes to learn how to help your business gain early access to their Tariff Repayment