Who keeps the tariff refund

For an owner whose company paid the tariffs imposed last year under emergency powers, the refund is now cash received or a claim in progress, and a buyer will ask who keeps it. In February the Supreme Court held that the International Emergency Economic Powers Act does not authorize the President to impose tariffs.^[1] US Customs and Border Protection reported that by October 2 about $126 billion of refunds, including interest, had been sent to the Treasury for payment, and on October 6 it opened a third phase of its refund system, for closed entries that a court has ordered reopened for importers that sued.^[2] On October 8 the Court of International Trade certified a class of all importers of record that paid the duties from February 2025 to February 2026, other than those with suits of their own.^[3] Our conclusion: settle who keeps the refund in the purchase agreement, with the figures in hand, before the price is agreed.

The refund goes to the importer of record

Customs says it can refund the duties, with interest, only to the importer of record or a party the importer names, not to consumers who paid more because of them.^[4] The court found that more than 75% of the $166 billion collected has been refunded with interest, that about $30 billion would remain on deposit if the refund system stopped now, and that the importers that have not filed are overwhelmingly small.^[3] Some entries are still outside the system, including those under open protest or claimed for drawback, and entries already closed for importers that have not sued.^[3][4] The government has appealed the part of an April order that covers all affected entries, and the appeals court has yet to rule.^[3]

Three claims on the same dollars

Who keeps it after a sale is a matter for the purchase agreement, and Mayer Brown advised in May that the answer will vary by transaction.^[5] A seller whose company absorbed the tariffs can argue that it bore the cost, and that a buyer who priced the company on earnings reduced by the tariffs, without adjusting for them, would receive a windfall if it also kept the refund.^[5]

A buyer will point to customers. Justice Kavanaugh's dissent noted that refunds would reach importers even where some had already passed the costs on to consumers or others.^[1] By June more than 80 putative class actions had been filed on the premise that a company cannot pass tariff costs to customers and also keep the refund.^[6] Even where customers have no right to reimbursement, the company may decide to compensate them, and if the seller has kept the refund, the buyer is left with that cost.^[5]

The accounts may not match the deal

Deloitte's preferred approach lets a company record a refund once recovery is probable, limited to the tariff costs it recorded; under the alternative, nothing is recorded until every contingency is resolved, and a refund owed to customers may have to be recorded first.^[7] Views on earnings differ as well. CLA advises keeping expected refunds out of EBITDA adjustments and showing the tariffs paid as a non-recurring cost without assuming recovery, while GHJ sees room for adjustments where refunds are approved or highly probable.^[8][9]

Show the refund before the buyer asks

Prepare a schedule by entry: duties paid, amounts claimed and accepted, refunds received with interest, and entries still outside the system. Then show how the cost was handled. Where prices rose or surcharges were billed, list which customers paid them, what their contracts say and any requests for reimbursement already received. Agree with the auditors how the refund will be recorded, so that the accounts and the quality of earnings report tell the same story.

In the purchase agreement, state who keeps refunds of duties paid before closing, who pursues open claims, at whose cost and for how long, and who bears any reimbursement of customers. In a sale of shares the buyer owns the company that holds the claim, so a seller entitled to the refund must rely on the buyer to pursue it and pass it on.^[5] Mayer Brown suggests the same terms cover any other tariff still under legal challenge.^[5] These points are easier to settle while the refund is a schedule than after it has become a dispute.