As a member of the turnaround ecosystem my work centers on helping companies navigate periods of stress, uncertainty, and, in many cases, survival. The advent of IEEPA tariffs by the Trump Administration in February 2025 created disruption across a wide range of industries. While much has been written about the macro-level disruption, global trade friction, supply chain instability, strain on international relations, and an increase in consumer prices, the impact on businesses was immediate and, for many companies, severe.
The IEEPA tariffs hit retailers, importers, distributors, and manufacturers particularly hard. Margins compressed quickly as costs increased, often without the ability to pass those costs along to customers. Lenders were forced to reassess borrowing bases as inventory values rose above realizable levels. Vendor relationships became strained as payment terms stretched and negotiations intensified. At the same time, companies faced longer working capital cycles, reduced liquidity, unpredictable pricing, and difficulty forecasting demand. Credit tightened, customers pushed back on higher prices, and operational decision-making became more reactive than strategic. In many cases, these pressures compounded existing weaknesses, pushing already challenged businesses closer to the edge. These same issues also disrupted otherwise healthy businesses, creating cash shortfalls, eroding profitability, and forcing difficult operational decisions where none previously existed.
In contrast to this turmoil, the legal reversal of these tariffs has created an unexpected lifeline for companies in turnaround situations. On February 20, 2026, the Supreme Court deemed the IEEPA tariffs unlawful. Shortly thereafter, on March 4, 2026, the Court of International Trade (“CIT”) ruled that companies that paid these tariffs were entitled to refunds. Then, on April 20, 2026, U.S. Customs & Border Protection (“CBP”) launched its processing portal, CAPE, allowing importers to file for refunds on IEEPA tariffs paid between February 4, 2025, and February 24, 2026. The CBP decided to implement refunds in different phases. Phase 1 was for entries that were unliquidated (not yet closed) and liquidated entries that were 90 days past their liquidation date. Phase 2 and future phases were to include final liquidated entries not included in the 90-day scenario noted above, and entries with open protests, reconciliation entries, drawback claims, and other complex entries. CBP indicated that refunds would be issued approximately 60-90 days after submission, and initial refund payments began on May 12, 2026. Thus, what was once a significant financial burden had now become a potential source of liquidity. The total amount of IEEPA refunds due to importers of record is approximately $166 billion. Since May 12th, the CBP has accepted $85 billion in Phase 1 claims for processing, of which $20.6 billion has been paid. An additional $42 billion of Phase 1 claims remain to be accepted and processed for payment. This leaves approximately $39 billion of non-Phase 1 tariffs to be refunded in future phases. As importers digested the mechanics of the CAPE process, many of the widespread operational delays originally anticipated by trade professionals did not fully materialize. While some larger or more complex claims may still encounter processing challenges, CBP appears to be handling many standard Phase 1 submissions more efficiently than initially expected.
Potential Effects of the June 2nd Appeal by the Trump Administration
Although things were moving smoothly, in the back of everyone’s mind was that the Trump Administration had a statutory deadline of June 8, 2026, to appeal the Court of International Trade’s refund decision. And on June 2nd, the Administration did just that. This Appeal is about more than a single refund program. The Administration has strong incentives to defend executive authority, avoid substantial refund exposure, and prevent a precedent that could limit future presidential actions. Consequently, the government is likely to pursue all available appellate remedies. Even if such efforts are unsuccessful, they can create uncertainty regarding timing. The appeal does not necessarily eliminate importers’ refund rights, but it has materially changed expectations regarding timing and certainty. The issue is how long importers may need to wait before receiving their refunds and whether additional legal and administrative hurdles may emerge for more complex claims.
Trade professionals believe that the $39 billion of non-Phase 1 tariffs to be refunded in future phases is the primary focus of the June 2nd Appeal. Unlike Phase 1 claims, which have generally proceeded through the refund process, the DOJ is seeking to prevent these non-Phase 1 entries from receiving automatic refunds altogether. As a result, companies with exposure to this $39 billion pool face a significant risk: without commencing additional legal action, they could be excluded from any future recovery. Importers and affected businesses should carefully evaluate whether to file protective protests, commence separate actions before the Court of International Trade, or pursue other available legal remedies. If the government’s position ultimately prevails, businesses that fail to take affirmative steps to preserve their rights may permanently forfeit their share of the $39 billion refund universe.
The gap between when a claim is filed and when cash is actually received may widen significantly for some categories of claims. The Appeal has transformed what many expected to be a relatively predictable refund process into a two-track environment as follows:
Phase 1 Claims: Still the Strongest Position
Phase 1 claims generally involve straightforward entries and refund mechanics. These claims remain the most likely to be processed first and ultimately recovered. However, even Phase 1 claimants should expect a more measured pace as agencies evaluate the implications of the Appeal and the possibility of further judicial review.
Non‑Phase 1 Claims: Greater Delay Risk
More complex claims involving final liquidated entries, protests, reconciliations, and other complex issues could experience substantial delays as Courts, CBP, and the Department of Justice determine how the appellate process affects refund administration. Importers should also recognize that the government may seek additional procedural relief during the appeal process. Even if such efforts are unsuccessful, they can create uncertainty regarding timing
Potential Litigation Timelines
Scenario 1: Expedited Review. A decision could arrive later in 2026.
Scenario 2: Standard Appellate Schedule. A decision may not arrive until late 2026 or early 2027.
Scenario 3: Supreme Court Review. Final resolution could extend well into 2027 or beyond.
The Hidden Cost of Waiting
A refund claim is an asset. Like any asset, it has a present value and a future value. Historically, importers focused primarily on how much money they would ultimately recover. Now, CFOs and business owners are wondering if and when they will actually receive the refund especially in light of the Administration’s June 2nd Appeal. In addition, companies must continue monitoring litigation developments, preserving documentation, tracking liquidation status, coordinating with customs advisors, and managing ongoing compliance obligations. The longer the process continues, the greater the uncertainty surrounding payment certainty, timing, administrative procedures, and future litigation developments.
Healthy companies with strong balance sheets, consistent cash flow, and no immediate pressure from lenders or vendors, and can afford to wait for the refund and see how the Appeal process pans out. These companies have the means to let the CAPE process run its course and collect the full value of their refund and interest in the ordinary course of government processing. Healthy companies have the flexibility to absorb delays, manage working capital internally, and operate without depending on the timing of their refund.
Unfortunately, many companies do not have the luxury of waiting out the Appeal process and patiently waiting to receive their IEEPA refund. These businesses were challenged either prior to or as a result of imposition of the IEEPA tariffs. In these situations, the ability to receive the IEEPA refund immediately rather than later can be the difference between survival or insolvency.
In response to this need, a market developed that allowed companies to quickly monetize their IEEPA tariff refund claims. Financial institutions have been actively purchasing these claims since mid-2025, providing companies with immediate liquidity. Pricing has evolved significantly as the risk decreased and certainty increased. Prior to the Supreme Court’s ’s decision in February 2025, these firms were purchasing tariff claims at an average rate of 20%. After SCOTUS’s decision the Buy Rate increased to 45%. After the decision of the CIT on March 4, 2026, mandating that all importers are due refunds, the Buy Rate increased to approximately 55%. As of June 5, 2026, the Buy Rate has reached approximately 90% and is even higher for claims in excess of $10 million. By way of comparison, Employee Retention Credit (ERC) claims were commonly monetized at approximately 85%. In that context, current pricing for IEEPA tariff claims appears both competitive and rational. It is also important to understand that these rates are market-driven. The June 2nd Appeal which could have the effect of slowing down the refund process and increasing uncertainty, might have the effect of decreasing the tariff Buy Rate. If an importer is seeking maximum value, now is probably the best time to sell their IEEPA tariff refund claim. Even Non-Resident individuals and businesses owned by foreign companies are eligible for IEEPA tariff refunds.
Why Some Companies Are Reconsidering the Sale of Claims
Earlier this year, many importers sold IEEPA refund claims because there was no clear refund mechanism in place. Starting two weeks prior to the April 20th launch of CAPE and once CAPE became operational and appeared to be operating smoothly, the sale of IEEPA tariff refund claims slowed considerably. Businesses expected the portal to provide a relatively direct path to recovery. However, the June 2nd Appeal has changed that belief. Many companies are now reassessing whether waiting for the government process to play out remains the optimal strategy. For these companies, certainty and timing may have greater value than maximizing the amount of future recovery.
Turnaround professionals utilize a combination of various tools in turning around a company. These include financial, operational, and legal tools including financing solutions, asset sales, vendor negotiations, and restructuring strategies. The ability to convert an IEEPA tariff refund claim to cash on an expedited basis is now an additional tool available to turnaround professionals.
Ironically, the same IEEPA tariffs that created significant financial stress, operational disruption, and liquidity challenges for many importers may now provide the critical source of recovery capital. While financially stable businesses can wait for the government process to run its course, challenged and distressed companies do not have that luxury. For challenged companies that require immediate cash flow to stabilize operations and support turnaround efforts, the current Buy Rate for IEEPA tariff refund claims appears to be at or near peak levels, making this potentially the optimal time for companies to monetize their claims and convert these refunds into immediate cash.
A business can monetize their claims strategically. Not every company should sell 100% of their claims. Many businesses are exploring alternatives such as selling only Non-Phase 1 claims. With this hybrid approach they can balance their potential upside against timing uncertainty by selling higher-risk claims while retaining the lower-risk claims in their tariff portfolio. However, challenged and distressed companies might want to consider selling all of their IEEPA refund claims as Phase 1 claims could be delayed due to the effects of the June 2nd Appeal.
The views and opinions expressed are solely those of the author and should not be construed as representing the views or official positions of the Turnaround Management Association.
Neil A. Seiden is Managing Director of Asset Enhancement Solutions, LLC, a New York-based debt advisory firm. The firm has been actively assisting companies nationwide in monetizing IEEPA tariff refund claims and has facilitated more than $25 million in such transactions. During the COVID-19 pandemic, AES processed approximately 1,500 PPP loans totaling $150 million and monetized $50 million in ERC claims.