ARTICLE | February 20, 2026

In a major ruling with immediate implications for North American trade, the U.S. Supreme Court struck down President Trump’s sweeping tariff program that had been imposed under the International Emergency Economic Powers Act (IEEPA). In a 6–3 decision written by Chief Justice John Roberts, the Court held that the administration exceeded the authority of Congress granted under IEEPA in using emergency powers to impose broad, economy-wide tariffs.

For U.S. and Canadian businesses that have spent the last year planning around rapidly changing tariff exposure, the ruling offers potential relief—but it also opens a complicated next phase: what happens to tariffs already paid, and what tariff tools the administration may use next.

What the Court decided—and what it didn’t

IEEPA allows the president to address certain unusual and extraordinary threats to national security or foreign policy. The Court concluded that the challenged tariff program went beyond what IEEPA authorizes for emergency economic measures.

But the Court did not resolve one pressing business question: whether importers will receive refunds for tariffs paid under the now-invalidated IEEPA program. Justice Kavanaugh’s dissent highlighted the practical stakes, warning that unwinding the program could create major near-term disruption, including the prospect of large refunds and administrative complexity.

The tariff landscape businesses have been navigating

The IEEPA-based tariff program included a broad baseline rate and sharply higher country-specific rates at different points in time, including elevated tariffs on goods from China and increased rates impacting North American trade. Canada, for example, faced tariffs that were later raised. Mexico also faced IEEPA-linked tariffs tied to the southern-border emergency order.

This volatility made pricing, contracting, and supply-chain planning difficult, and it triggered litigation by importers arguing the program exceeded lawful executive authority.

The billion-dollar question: refunds

Because the Supreme Court did not decide refunds, the issue now shifts to the U.S. Court of International Trade and related proceedings. Many importers have already filed suits seeking recovery of duties they paid under IEEPA.

A key practical issue is claim preservation. In many customs-duty disputes, refund eligibility can depend on whether an importer properly preserved its claim through required customs procedures (including protests, depending on the posture and mechanism involved). That means companies should promptly assess:

• which entries were subject to the now-struck IEEPA authority,
• what was paid and when,
• and whether procedural steps were taken that could affect refund eligibility.

What happens next: tariffs may return through other laws

The decision restricts this particular use of IEEPA, but it does not eliminate the administration’s ability to impose tariffs through other legal mechanisms that include more structured procedures. In practical terms, that means businesses should not assume a simple return to pre-IEEPA conditions. Tariffs could reemerge in more targeted forms under different statutes.

Practical steps for businesses now

Companies should consider taking these steps immediately:

1. Map and document all IEEPA-related tariff payments and associated entries.
2. Confirm claim posture (protests/claims/litigation posture) with customs brokers and trade counsel.

At Larson Gross, we will continue to monitor how this may develop and its implications for our clients and their businesses. If you have immediate questions, feel free to reach out below or call us at 800 447 0177.